How to Buy a House at AuctionBy Angela Smith, Communications Manager
November 19, 2020
For buyers, the biggest perk is being able to buy a home at, sometimes, an incredible deal.
There are many perks to buying a home or piece of property at auction. For sellers, you can sell your property very quickly and for fair market value. For buyers, the biggest perk is being able to buy a home at, sometimes, an incredible deal.
If you’re thinking of attending a live or online auction to buy your next home, here are some tips to help you navigate the process and outbid the competition.
Educate yourself on auctions. There are three different types of auctions: reserve, minimum bid, and absolute. All of these can be conducted either live on-site, online only or by submitting a sealed bid. It’s important to know the differences, rules and requirements for each one. It’s also nice to know why the home is for sale by auction. Is it a foreclosure, an estate auction, or maybe a bankruptcy? Or is the owner just trying to sell quickly for other personal or financial reasons?
Research the neighborhood. Check out the value of similar properties in the area around the home to get a good idea of what the property is worth. You can also research crime rates, school districts and other important factors for you and your family.
Check out the property in person. Sometimes the property may be vacant for weeks or even months and can end up with wear and tear or even vandalism. Drive by and even take a peek in the windows if you can so you can fully see what you’re buying. Many auctioneers will also host property previews or inspection dates of the property prior to the auction.
Financing may not be an option. Most, if not all, auctions are considered a “cash sale”. So, make sure you have sufficient cash or assets to meet the financial requirements of the sale. If you plan to borrow a portion of the money for the sale, have a conversation with your banker first to determine what level of bidding you are qualified to bid up to. Also, check to see if there are any additional expenses in the sale such as back taxes, liens, etc., and who is responsible for these at closing.
Bid smart. As long as you’ve done your research, you’ll know how much the home is worth and how many repairs the home might need. Start the bidding low and don’t go over your budget.
As always, the best thing you can do is get an experienced agent or auctioneer to help guide you through the process if you have any questions.
Unitd Country Auction Services has qualified and experienced auctioneers across the nation ready to help you sell your home, land, personal property, farm equipment and more. Learn more or find an auctioneer nearest you at www.auctions.unitedcountry.com.