Real estate auctions are a great way to purchase properties below market value. Nowadays many of these events have moved online, but you can find live public real estate auctions if you know where to see them listed. Whether live or online, these can be great opportunities for both buyers and sellers. Below I’ll share my experience with the real estate auctions near me. Also I will discuss where to find these events locally, winning tips, and basics of how they work.
Map of Real Estate Auctions Near Me
For “Real Estate Auctions Near Me”, see below for locations…
What is a Real Estate Auction?
A real estate auction is which homes, property, and/or land are sold via a bidding system. It offers and opportunity for buyers to aquire realestate at low price points. There are various ways these auctions are run, but what they all have in common is that once you bid, you create a legally binding agreement. So any property you bid on you are legally required to pay the agreed final hammer price.
How Do the Real Estate Auctions Near Me Work?
Real estate auctions are often in a format as follows:
- Real estate for auction is posted in a catalog and potential bidders can review.
- An inspection phase where bidders visit the property and assess it.
- Bidder registration, where all potential bidders officially sign up to participate. Each must have proof of identity and proof of the ability to pay. Some auctions will offer financing.
- The event begins and an auctioneer facilitates the event. They are only auctioning real estate that the auction company has established an agreement with the deed holder.
- The auctioneer starts with a lower price, sometimes below market value (or even the reserve), to try and entice bidding.
- When a registered bidder makes abid, the auctioneer incrementally raises the price to check if any other bidders are interested at the new raised price The increments are relative to the expected price of the property.
- The registered bidder who has the highest bid at the end wins, so long as the set reserve has been achieved.
This is how the real estate auctions near me work.
Benefits of a Real Estate Auction
Real estate auctions have benefits for both buyers and sellers. Here are a few…
Buying at an Auction
- Property will be priced fairly based on the current market values.
- It is quicker to close on a property via auction, then going through a real estate agent.
- There is no lengthy drawn out negotiation. You bid against other bidders and then it’s over.
- You can inspect the real estate before hand and ask questions as you would in tradional buying scenarios.
- Ability to get a piece of real estate below the market demand.
- There are no real estate agent fees.
Selling at an Auction
- Sales are immediate. That means you can have a finite date that you sell your home.
- If a bidding war ensues you can get over the market value for the property.
- Since you pre-sign with an auction house the percentage agreed to for their services is arranged up front.
- If you find ra good auction company who has high end clientel, your property will be marketed to high end bidders.
Finding Real Estate Auctions Near Me
There’s many ways to find real estate auctions near me. Traditionaly newspapers and classified ads are still ways some find live public events., Now more people find listings of live public events online. There are sites like USA.gov where you can find real estate auctions that are done by the government. You can also look for local foreclosure auctions.
How I Find Real Estate Auctions Near Me
One of my best tips is to use Google Events to find real estate auctions in my local area. Some of these events are live only and are not nationally marketed. That often translates to smaller crowds and less competition to bid against. Click here for Google Events – Real Estate Auctions.
Where does the Real Estate Come From?
Whether land, homes, or a combination of both the properties are put up by a deed owner. That could be a person, company, or a bank that holds the deed. The deed owner has decided to bypass hiring a real estate agent. The choice is often based on convenience, the need to dump a property by a specified date, or the hope of finding the best bidder who may over pay.
When a piece of real estate comes from a bank, it is often the result of a repossesion. This happens when the owner fails to pay the mortgage and the bank reclaims the property. Many people avoid repo real estate as it can be a neglected property. Before you start bidding on real estate you need to check for this up front. If it is not explicitly stated, ask.
Are Real Estate Auctions Priced Fairly?
In my experience with the real estate auctions near me, the properties are posted according to fair market value. Sometimes when a property is on the block it may begin below fair market value. That is because the auctioneer is trying to entice the action.
When you win a piece of real estate at auction there is no negotiation. You only need to pay a bit more then someone else is.
Are There Fees to Buying or Selling Real Estate at Auction?
Yes. there is a potential for fees on both the buying and selling sides of these events. For the seller they agree to a percentage of sale up front with the auction house. When the final bid price is established, they will pay the agreed upon percentage of that number.
Buyers may also have a fee for winning, which is added on top of the final bid price. It all depends on the auction company. Reading the rules up front at for any auction is important before you bid.
Who Can Bid?
Only registered bidders are allowed to particpate. To register you must prove your identity, residence, and your ability to pay should you win. Since real estate can be hundreds of thousands of dollars, most have financing options for bidders. Once you are registered you are eligible to participate in the auction.
In some cases you may have hired a proxy (buyers agent) to bid on your behalf. That person has the legal right to register and place bids for you based on a signed agreement.
Winning Strategy for Real Estate Auctions
- When you attend a live public event, dress sharp. Looks inimidate other bidders.
- Sit or stand in a place that is in the direct line of site from the auctioneer.
- Don’t over socialize or tell other participants how much you can afford (or not afford).
- If a property is above your limit you can ask the auctioneer to reduce the reserve. While this could get you the win, it can backfire and invite in other interested biders.
- Feel out the room and decide if it’s better to be aggressive early or late.
- When you say your bid say the full hundred thousand. For example don’t say 200, say 200,000. You will be more inimidating.
- Before the event ask the auction company about their clearance rate. This is percentage that shows how many properties an auction has sold during the previous time period. Ideally you want a rate below 60%. That means low interest from buyers, which equals low real estate prices.
- If you think you are an emotional bidder, hire a buyers agent to bid on your behalf.
Real Estate Auctions Near Me Conclusion
Real estate auctions can be great for both buyers and sellers. For a buyer it is an opportunity to skip negotiations, skip real estate agent fees, and get a property quickly and possibly below market value. For a seller it means dumping a property on a specific date, a quick sale, and the potential for a bidding war to drive the price up. Auction co’s with clearance rates below 60% are ideal if ou are a buyer. This is what I have learned from the real estate auctions near me.