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Are there rearlly any deals at Real Estate Auctions

By
Real Estate Agent with Intero Real Estate

 

I have been to auctions in the past where is was difficult to get an average deal. All of the market values is checked in the auction catalog were inflated by $100,000 to $200,000.  With the buyers premium of 5% added to the closing price and the environment of the auction, it is my impression that most folks will probably pay more for the home at auction than they would if they tried to purchase during a short sale or as an REO.  Antoher benefit of short sale or REO's are that the buyer has additional time to inspect/evaluate the property. The due diligence time reduces the buyers risk. Since the buyer is taking on additional risk at the auction there should be a monetary compensation in a reduced price - which never seems to materialize. Another thought is that there will be others in the crowd that may or may not have properly evaluated the subject property and they bid up the home. So I feel that the frenzy that takes place during real estate auction will only benefit the banks and the very sophisticated real estate investor.

Erin Newington
5305573559 - Grass Valley, CA
Sierra Foothills Realtor
In the past auctions in the Sacramento we have seen folks get caught up in the hype and pay 25% more than the house is worth.  To me you should just by a REO and have the ability to do your full due dilligence.
Apr 29, 2008 05:45 PM
Bob & Carolin Benjamin
Benjamin Realty LLC - Gold Canyon, AZ
East Phoenix Arizona Homes
People who buy at auctions need to be very careful. There are a lot of possible risks for them buying that way.
Apr 29, 2008 05:54 PM
Greg Hampton
Re/Max Around The Mountains - Blue Ridge, GA
North Georgia Mountain Property,Blue Rid
Most bamkers would rather REO than short sale,they still have a bad debt in there portfolio. They  and I do not like auctions because of the cost to sell/buy.
Apr 29, 2008 05:57 PM