If you're looking to get a good deal on a home, you might want to consider buying one at an auction. You can often buy a fixer-upper at an attractive price when it's on the auction block. However, keep in mind that other, more experienced real estate investors buy homes at auctions so you'll have competition. Here are a few things to know about buying a home at an auction.
Understand The Type Of Auction
Don't fall in love with a home because it has a low starting bid. The auction house may list a low price to lure in investors, but that doesn't mean the home will sell for anywhere near that price. Other auctions set a high minimum bid rather than a low one so they are sure to recoup their losses. There are different types of auctions. Some of them have a hidden low limit which means even if you're the high bidder your bid could be rejected if it doesn't meet the minimum. Other auctions sell to the highest bidder no matter what the amount. The type of auction will be listed in the details so you'll know what you're getting into before you start bidding.
Know The Requirements
Auctions also have their own requirements. You may need to have cash before your bid is accepted. You may be bidding against seasoned investors who have no trouble coming up with cash to buy a home, so you may not be taken seriously if you can't put up the required down payment or full cash price if you win the bid. Others may allow financing, and if so, you'll want to have financing arranged and approved before bidding starts.
Investigate The House
One drawback to auction houses is that you might not be able to see the interior of the home before you bid on it. It's best to assume the home is in bad repair and you'll have to do major work on it to get the house in shape. If the home is unoccupied, it could be little more than a shell filled with mold and rotting wood. If the home is occupied, it might be functional but in poor repair and outdated. Be sure to factor in how much it will cost to renovate the home along with how much you're willing to pay for it. Also, don't forget to check the title to make sure it is clean and that there are no liens on the property.
Control Your Excitement
It's easy to get carried away at an auction, especially if the home is in an area you want to live. You may want to hold off on bidding until the last few minutes so you don't drive up the price necessarily. If the price gets out of your range, be prepared to let the home go and move onto the next auction. Being determined to win an auction is risky since you may end up paying much more for the home than it is worth.
Try to attend a few home auctions before you actually bid on one so you feel comfortable with the process. It can be confusing and scary to bid so much money and buy a home you may not have seen on the inside, so taking your time to learn the ropes first is a good idea.
Hello, my name is Ben Hatten. Welcome to my website about selling your home on the real estate market. When I was ready to sell my home, I thought that the process would go smoothly from start to finish, so I did not acquire help from an agent. After learning about all the things that could go wrong, I decided to enlist the help of an agent to sell my home with assistance. I created this site to help everyone prepare for the process of selling their home with help from an agent. I hope you will come by often to learn more. Thanks.