Luxury house auctions are not your grandfather’s way of buying and selling real estate. Today’s savvy buyer loves a real estate auction because they are fast moving (our auction process takes 60 days start to finish), and they can get a true market price (all the pertinent buyers are in the room on auction day).
In a traditional real estate transaction, you and your representative know the process. An agent or attorney writes up a contract that typically includes contingencies like financing, inspections, surveys, and so on.
House auctions are a bit more fluid. The terms of house auctions are specific to the state and the property in question, but typically don’t include contingencies. Knowing the Terms and Conditions before you buy a house at auction can help you decide if you want to participate and help you formulate a game plan as to the proper steps for participation in the auction.
Start by determining what is most important to you in buying a luxury home. Personally, I want to know everything I can about the house itself, so I would always have a home inspection before bidding on a property at auction. If you’re interested in the potential of future development or expansion, then you may want to review the platt map, survey and zoning laws.
Remember, there are no contingencies in most house auctions. So, if these things are important to you as a buyer, make sure you investigate them before the auction.
Your opportunity for any due diligence is prior to the first call for bids. To put it frankly, once the auction starts, your only input is raising your paddle on what you are willing to spend on the property.
Image by Mike Russo: Live from the Robert Taylor Ranch auction in Brentwood, California,.
What sort of due diligence is important to you in buying luxury real estate?
