It looks like you’re moving into some exciting territory if you’re looking to purchase a home at auction. Are you aware of what it’s going to take to make the investment worth it? Have you already planned out the steps you’re going to take? What constitutes a good deal? The more information you have about the property before the better the investment you can make.
Buying a home at auction isn’t always a safe bet and it’s always risky. Knowing the best steps to take can minimize risk but be aware that there will ways be a risk. Don’t spend any money unless you know you can take a loss. When can you find a home on auction?
Finding Foreclosures
Finding foreclosures may be more easy or difficult depending on where you are located. In Los Vegas, for example, foreclosures are a pretty common thing. Some of these foreclosures will put the home up at 30-50% of their market value. This is obviously a stellar deal and if you can find a home you have an affinity towards then more power to you.
Going to Auction
The next step is to go down to the auction site to get a feel of the area. Every county has different auction rules and set up so be sure to be aware of these so that you’re prepared when you go in. Even if you don’t plan on bidding it might be a good idea to go to auctions anyway to get a feel for the environment and see how people bid.
Home Condition
The condition of the home may or may not be important to you. If you plan on living in it for a while before flipping then the condition probably matters a bit. See if you can find some old photos online or if the house is open to being walked through then head down there ASAP. The more information you get on the home the more powerful your purchasing power will be so that you can make a smart investment decision.
Check Your Money
Calculate the maximum bid for each property that you are interested in. Write it down and stick to your maximum bid, not a penny more. It’s easy to get carried away with the emotion of bidding wars, but being willing to let a property go is your safety net. Know that the property will probably require some kind of work so calculate that into your budget as well.
Analyze And Then Analyze Some More
It’s important to really, and I mean really know what the risk you’re taking is. If you don’t know your budget, home condition, selling plan, then you’re setting yourself up to lose. THings happen that you can never prepare for but if you don’t prepare for the things you know are going to happen then those little surprises are going to be more difficult to handle. Patience and planning are the keys to succeeding at auction so go in ready and you’ll come out winning.
