Attending commercial property auctions soon? Great! You’re in for a few thrills and if you’re lucky a treat too in the form of a worthwhile purchase. But just as much as these things are fun and potentially rewarding, a smart investor knows how to both prepare and to keep their guard. Do you want to be like them? If so, these reminders should come in handy.
1. Make it a point to validate and double check. As is with any selling event, agents, owners and sellers at property auctions want a sale and thus the presence of sales talk. You need to remember that authenticating facts is a must to ensure that the asset you are buying is indeed worth every penny and is what they say it is. Take things with a grain of salt. Do not be fully trusting. Check the ownership validity. See if there are any liens or encumbrances on it. Have it pre-surveyed. 2. Withhold information and keep your cards away from view. Sellers and agents who are auctioning off assets will want to know how much you are willing to pay for and which assets you’re eyeing. They can use this against you and require a higher opening bid. At the same time, co-bidders will always be curious knowing that you may have found a gem at the commercial property auction. 3. Dress appropriately, neither extravagant nor below par. Doing so will not only make you feel more confident but it should allow other bidders and even sellers to take you more seriously. Just don’t overdo it. We don’t want people assuming you’re swimming in cash, even if you are. 4. Have your finances ready beforehand. See to it that you have your funds sorted out and all. When you bid, be sure that you can come up with the means to provide for the payment. Oftentimes, a security deposit will be required to participate. Plus, the winning bidder will often have to provide a down payment upfront. 5. Set a limit and stick to it. Contrary to a mathematical equation, yes the limit exists and it’s crucial when participating in commercial property auctions. You need to have a maximum spending amount or else all hell will break loose. You need to act wisely and with that comes the need to conform to your budget and available finances. Head above your heart, remember?
Watch this commercial property auction video below:
Assets are referred to as items of property to which a value can be assigned and this includes real estate or fixed properties. Investors acquire the said assets in various ways and one of them is through online property auctions.
Auctions are public sales that involve a bidding process wherein the items at hand are sold to the highest and therefore winning bidder. It is a form of marketing and competitive trade that has become widely popular among buyers and sellers alike. This is because, it is possible for one to acquire an asset for lower than it would have been if it were bought right off the market.
There are cases when the heirs or benefactors of a certain asset could not come into agreements as to its partition and/or disposal. After all, properties cannot be physically divided unlike cash. To settle the estate once and for all and to govern an equal split, the asset is sold at an auction where its proceeds shall be divided and distributed to the heirs in accordance to their shares as mandated by the will or in its absence the court. 2. Foreclosure
When a borrower defaults and fails to comply with the terms of their credit, lenders and creditors like banks and financial institutions can foreclose their property as part of the collateral. The lender now shall want to liquidate the asset in order to recover the amount that has been owed and unpaid. Auctions are a good avenue for them as they tend to make fast sales compared to the usual course of selling. 3. Market
When the market and the economy are at a low and things are getting sluggish, investors and sellers will look for other means to initiate a sale. Auctions are one of their best options at this point. Since many buyers are interested and investors are looking, it gives them a wider audience allowing for a transaction.
Today, online property auctions are held both physically and digitally. With the former, a venue is set where interested participants are expected to personally come and bid. With the latter, things are done on a digital platform, that is via the internet and a computer. In both instances, the responsibilities and requirements are still the same. However, different auction houses and sites may have varying conditions and procedures so it is best to research and ask first before deciding to participate.