One of the most useful techniques to get the winning bid on auction real estate is to work with a professional. Having a mentor is helpful in any industry or practice. It provides the learning apprentice an opportunity to study from someone who has experienced this in the past and either needs to bring in some new talent, or is nearing retirement and wants to pass on all that he/she has learned. Either way it is a great opportunity to study and learn from someone who has been there before.
The next strategy and probably most important is to do as much research and due diligence as possible before the auction. With auctions, time is of the essence. You will be in a fast moving and highly competitive environment, and you will not have time to ask any questions during or after the bidding process. Therefore, it is important to do all of your research ahead of time to make sure that this piece of property will fit into your portfolio. Does it have any current liens against it? What is the current condition of the property and the buildings on the property? How will the property be transferred? Are there any taxes owed? This can vary from state to state. In Utah for example, back taxes are owed to the county, and the county will foreclose on the property and auction it off to the highest bidder after several years of owing; Whereas other states sell the note for owed taxes to the highest bidder after year one. A local real estate agent in your area should have knowledge of your state’s procedures.
The last tip is to go in with a surplus of cash. At the auction cash is king. Whether it is your personal savings or capital acquired through private investors, you will need cash in hand in order to successfully buy property through auction. The traditional way of buying property is to borrow from the bank, but the auction process moves so quickly that there will be no time to go through all of the procedures that traditional lenders require these days.
Whether you are an investor, professional or first time home buyer, when the proper steps are taken, great deals can often be found at real estate auctions. For more information contact a real estate professional.