Real Estate Auctions – Know Before You Go

by Greg Cryns

            Many people are turning to real estate auctions in order to get a good deal on a new home.  While this was once a rare occurrence, home auctions are becoming a more common and accepted way to purchase a home. Before you go to a real estate 

auction, though, there are a few things you might want to know.  It’s important not to just show up at an auction without doing a little bit of preparation.  You need to know what you’re buying.

            As you prepare to go to an auction, you should make sure to actually visit the properties that you’re interested in purchasing.  During the month following up to the auction, most properties will offer open houses for prospective buyers to inspect the property. 

At this point you need to make sure you understand what kind of condition the property is in.  For example, you need to note any repairs that need to be made.  These repairs need to be taken into consideration when you’re deciding how much you’ll spend on a specific home or homes.

            Before you attend the auction, make sure you’ve decided exactly how much you’re willing to pay for a property.  This way you’ll know when to stop when the actual auction takes place.

            If there’s more than one property being sold, make sure you know which one you’re going to bid on.  You may also want to consider bidding on more than one property.  That way if you attend an auction and you aren’t the highest bidder for one property, you may be able to get another property that interests you.           

            On the day of the auction, make sure that you get to the site at least 30 minutes early to register for it.  You’ll have to fill out some paperwork before you can participate in the auction.  You’ll also need to be prepared to make a down payment on the property with cash or a personal check.

            The actual auction may be very short.  In fact, some may be as short as 10 minutes!  Auctions go very fast as people bid higher and higher.  When the bidding slows down and come to a halt, the auctioneer will announce that it is “sold” to the highest bidder.

            The process can be overwhelming if you’re participating for the first time.  You may want to try to observe an auction or two before you participate in an auction for a property that you like.  This will help you to see how the procedures work before it’s your turn to do it yourself.

 

Greg Cryns is the owner of Flat Fee Real Estate Guide - http://www.flatfeerealestateguide.com