How We Chose The Best Online Auction Websites
We looked at 28 online auction websites available and narrowed it down to the best options based on several features and considerations. We considered fees for both the buyer and seller, the sites online reputation, real customer reviews, and available categories. Some sites are free for buyers, and others require a membership to bid on items. Those membership fees should be reasonable.
Buying Real Estate At An Online Auction
Elizabeth Weintraub is a nationally recognized expert in real estate, titles, and escrow. She is a licensed Realtor and broker with more than 40 years of experience in titles and escrow. Her expertise has appeared in the New York Times, Washington Post, CBS Evening News, and HGTV’s House Hunters.
David J. Rubin is a fact checker for The Balance with more than 30 years in editing and publishing. The majority of his experience lies within the legal and financial spaces. At legal publisher Matthew Bender & Co./LexisNexis, he was a manager of R& D, programmer analyst, and senior copy editor.
Most house hunters don’t initially set out to bid on a home through an online auction. They may be conducting online research or attending virtual viewings, but just as these online activities have become more mainstream in the real estate industry, online auctions have become more common as well. You may be searching for homes online when you come across the perfect listing, and there in the small print you discover that the sale is subject to an auction. Don’t let it deter you.
Here are some reasons a house might be sold at auction, the breakdown of the auction itself, and what you’ll need to know in order to participate.
Top Online Real Estate Auction Websites
September 28, 2018 By Jorge Vazquez
Real estate auctions have continued in popular, especially as people reply more on technology to buy and sell homes, and digital auctions increase in their popularity. Auction web sites are also a great way for real estate investors and homebuyers to efficiently locate and purchase real estate at outstanding prices.
In this article, we briefly review four of the top online real estate auction websites, giving you the pros and the cons of each, to help real estate investors make more money. And at the end, we give you a bonus list of real estate auction websites you should investigate.
Recommended Reading: When Did Toys R Us File For Bankruptcy
Highlights From The Press
Offr aims to remove stumbling blocks during property deals
In a sector stymied by trust and transparency issues, Offr, a new Irish prop-tech start-up, is set to revolutionise the way we buy and sell property in Ireland.
Proptech start-ups that could change the way you buy, sell and let your home
Can you remember when a property search didnt involve a property portal and some armchair househunting? Technology has transformed the search and sales element of the property market, yet other tasks such as the endless process o
Offer management platform to launch in UK co-founded by star agent
Could you cut months off your deal time
Sitting on estate agents websites, Offr will store bidders identities and proofs of funds in advance of the acceptance of any offers, in an effort to improve the transparency of the sales process.
PropTech platform claiming to halve transaction time wins cash boost
A PropTech platform that claims to halve the time a transaction takes has received a huge cash injection from investors for its development.
BidX1 veteran Hoban& amp #039 s Offr accepted as he raises 3m of fresh funding
Offr, a property tech startup co-founded by former Savills and Allsop / BidX1 auctioneer Robert Hoban, has raised 3m in funding from Barclays Bank and a group of angel investors and venture capital firms.
Proptech start-up Offr secures Barclays backing for UK debut
Irish proptech startup Offr has raised a £2.7 million seed funding round from Barclays.
How Can Consumers Discover Online Auctions On Realestatecomau
Customers who partner with Realtair Sell, Openn Negotiation, Anywhere Auctions and Gavl are able to link live and upcoming online auctions to their listings. Once linked, the listing will promote the online auction date to buyers in the lead up encouraging them to register for the auction.Buyers can also use the ‘Online Auction’ icon, filter and a new sort option to discover auctions that are happening online. A ‘live’ indicator appears against listings when there is a live auction so they can watch the bidding in real-time.
Don’t Miss: What Are Some Of The Effects Of Declaring Bankruptcy
How To Monetize Your Real Estate Auction Platform
Merely creating a bidding platform will not generate any revenue. A monetization strategy is something you need to start thinking about even before starting your web application development. As a rule, companies like Yalantis assign a dedicated business analyst to help you decide how your app is going to make money.
The majority of bidding platforms charge users for the services provided. Fees usually include:
- Buyers premium. This is a common fee from 5 to 10 percent of the final property price that is paid in addition to the hammer price. It is charged by the auctioneer in addition to the sellers commission, which is a fee that auction houses have historically charged consignors. During an online real estate auction, the winning bidder has from 30 to 40 days to pay the buyers premium. If they fail to make this payment, the auction house re-auctions the property.
- Transfer tax is a fee paid for transferring the property title to its new owner. Transfer tax is stated in the sale agreement, which a buyer gets before the deal is closed. The tax is different for every state. In California, for example, it is $0.55 per $500 of the sale price.
- A technology fee is a fee for an auction platform service. It can reach up to $500 and is included in the prices of all properties presented on the platform.
Read also: How to Build a Real Estate Web Platform
How Can You Tell If An Online Auction Site Is Legit
Before buying and selling on an online auction site, look at its reputation. You can usually find real reviews on social media sites like Reddit or Facebook. Legitimate auction sites offer privacy, security, and dispute resolution.
Its important to understand that while an online auction site might be legit, there are unscrupulous buyers and sellers on most platforms. Check seller reviews before bidding on an item, and if youre a seller on a platform that allows buyer reviews, like on eBay, look at their reviews, too.
You May Like: How To Apply For Personal Bankruptcy
Finding Real Estate Auctions
One way to find auctions is by contacting local governments directly or visiting their websites for information and then following up by phone to confirm the details. Another is through sites such as RealtyTrac.com and Auction.com. However, online information is not always accurate.
Properties may be listed that are in pre-foreclosure, because the owner is behind on payments. These properties may never go up for sale because their owners catch up on payments or come to an arrangement with their lenders.
Local real estate agents and brokers can also be valuable resources. Unfortunately, you may not find them eager to help, because agents and brokers do not automatically earn commissions on live auctions. However, these realtors can earn commissions through online auctions.
How Do Online Real Estate Auctions Work For A Seller
An online property auction from websites replicates a standard property auction usually held onsite or at an auction room.
The online system manages it all: the registration of buyers and sellers, a process for receiving and accepting bids, it even notifies buyers when a propertys reserve price has been reached.
These online auctions give the exclusive right of negotiation to the highest bidder should the reserve not be met. This unique feature creates competition.
This process is done in a secure digitised environment with an audit trail that stores the records for future reference.
Upload Property
Once registered, uploading a property is easy and can be swiftly done within 5-10 minutes. The auction site will provide a highly experienced auctioneer for you.
Auction Settings
The actual auction commences after the typical marketing campaign comes to an end and is typically five days long but can range anywhere from 1 to 14 days.
Other critical auction information such as the reserve price, bid increments and starting bid can all be decided and specified later.
Registering Bidders
As prospective buyers view the property, the agent encourages them to pre-register for the auction even if they are unsure they will bid.
All bidders must prove their identity with the agents using an institutional form of photo identification which shows current residential address .
24 Hours To Go
One of the unique strengths of a virtual auction is to commence auctions with a starting bid.
Read Also: How To Remove Bankruptcy Accounts From Credit Report
The Next Evolution In Real Estate Transactions
An online real estate auction is a natural and intuitive solution for buyers and sellers. Buyers are already comfortable conducting their property research and due diligence online, so an online transaction makes sense. Unlike a traditional onsite auction that is over in minutes and causes all parties high levels of stress, an online property auction runs over several days giving all participants valuable time and comfort. Its a secure, fully compliant process that enables buyers to bid in an auction wherever they are, meaning increased buyer reach and participation resulting in better outcomes.
With 30+ years of auctioneering experience and having called over 35,000 physical auctions himself, pre-eminent auctioneering expert David Scholes has developed SoldOnline to be a valuable tool for the real estate industry designed to benefit buyers, sellers and agents. Its a natural evolution in real estate transactions.
Multiple Listing Service Data
Direct multiple listing service reports are far more valuable to potential buyers than online listings, according to White, because they contain the full data for the listing, including photos and, most important, nonpublic broker comments. Non-public comments are important because they specify critical information impacting sale price and days-on-market, says White. This information can cover property defects, financing options, occupancy, and tenant leases.
The best way to assess an auction property is to work with real estate agents, appraisers, and contractors. These industry representatives understand construction and remodeling costs and can accurately estimate the propertys value and the cost of the work it may need.
While rules vary by location, MLS and county records are often only available to real estate licensees, according to White. In his experience, they are usually happy to help free of charge if you contact them.
White also notes that in-person auctions have been disappearing because even smaller counties have been moving them online. Miami and Palm Beach are two locations where both tax and foreclosure auctions are now fully online.
Keep in mind that foreclosure auctions are often postponed or canceled, even at the last minute. The lender might not have obtained all the paperwork it needs, or the borrower may have worked out a solution to avoid foreclosure.
Recommended Reading: Can You Claim Bankruptcy On Court Fines
How Much Does It Cost To Buy Through An Online House Auction
Online auction sites are usually compensated by charging fees for their services. Before you bid on anything, you should carefully review the information listed on the site.
This will help you understand what fees youll be charged. Online auction fees can include:
- Buyer’s Premium: This usually costs between 5 10% of the final purchase price of the home, or a flat fee of $1,000 or more.
- Transfer Fees: This fee is generally $1,000 or more.
- Auction Service Fee: The fee can be $3,000 or more.
- Technology Fee: An additional fee for using online services, usually costing around $200 $500.
- Bidding Deposit: A bidding deposit is a form of earnest money, and its applied to a bidders overall purchase price. However, this deposit is forfeited if the buyer fails to pay the full purchase price within the auctions time frame, usually within 24 hours of the auctions end.
What Bidders Need To Know
Before bidding at a real estate auction, you should understand the risk you are taking. A bad purchase could haunt you for years. You also need to understand the auctions rules and be prepared to follow them before trying to participate.
You will have to register and submit a refundable deposit of 5% to 10% of the propertys expected selling price to the entity holding the auction. If the auction is in person, be sure to check in at least an hour before the scheduled start and obtain an official card, which you will raise when you are ready to bid.
Winning a property at auction can work in two different ways.
- In a lender confirmation auction, the lender does not have to accept your offer, even if you are the highest bidder.
- In an absolute auction, the winning bid gets the property.
The starting price of the auction may be the balance owed on the mortgage or a lower amount designed to spur bidding. In a foreclosure auction, the lender is not allowed to profit from the auction. Often, these properties are sold at a loss if there is a profit, it is supposed to go to the foreclosed homeowner after the mortgage and any other liens are paid. Auction properties are not always great dealsfor example, the auctioneer could set a hidden reserve price on a property, which is the minimum that must be bid.
Read Also: Did Snap On Tools File For Bankruptcy
Testimonials From Our Customers
“We successfully bought a house in 2020, during the restrictions of Covid-19, and ever rising prices. Our confidence in existing bidding processes was pretty low, with unclear offers, unknown bidders and a huge amount of trust required in a large selection of companies we had no previous dealings with. Discovering Offr, however, was a revelation. Its provision of clear, accountable bidding gave much greater confidence in the entire process, by knowing for sure that bids were associated with a genuine bidder and to the value stated. It allowed us to approach the entire process better equipped to make rational decisions about our own bidding practices, and ultimately saved us time, money and anxiety! I would highly encourage all estate agents to adopt such a system, as it benefits everyone in the long run companies, bidders and sellers alike”
- Unit 6E, Nutgrove Office Park
- Rathfarnham, Dublin, D14 A0X2
How Do Online Auctions Work:
Online auctions platforms provide all the benefits you would get from an in-person auction. This includes details of interested bidders which are captured ahead of an auction. Buyers can place bids online, in real-time and In most cases, platforms enable the entire contract process to be managed digitally.
Don’t Miss: Does Bankruptcy Ruin Your Credit Forever
About Adams Auction & Real Estate Services Inc
Adams Auction and Real Estate Services, Inc. was founded by the current President and CEO, Adam Jokisch, over 34 years ago. Adams leadership, hard work, and determination have taken the company from its roots to its present-day status and continue to propel the company to new heights.
Consistent growth and success have been attained by the companys aggressive, pro-active approach to the auction industry. Focusing on industry changes and trends, as well as changing client needs, Adams Auctions has continued to refine its offering of services by specializing in Online Only Auctions.
Adam holds real estate licenses in Illinois and Missouri and auction licenses in Illinois, Missouri, Colorado, Alabama and Arkansas. His level of expertise, experience and knowledge, combined with passion for his work, provide a strong foundation that has guided the company through a successful past and towards a bright future.
Best For Government Surplus Items: Gsa Auctions
GSA Auctions
When buying government surplus items, you want a legitimate website, and not one simply pretending to have affiliation with the U.S. government. GSA Auctions is a government website where you can buy Federal property like boats, helicopters, luxury vehicles, medical equipment, and even NASA Shuttle/Hubble items.
-
Its an actual government website
-
Use proxy bidding to indicate your maximum bid
-
Payments made to the U.S. Department of Treasury at Pay.gov
-
Must verify your information with Experian to register an account
-
If the auction doesnt meet the minimum reserve, you dont win the auction even if youre the highest bidder
-
Reserve price is never listed
GSA Auctions is the best online auction website for government surplus items because its an official government website run by the General Services Administration. Youre not paying a markup to a website pretending to be affiliated with the government. Every listing has a minimum reserve price, which means even if youre the highest bidder, you may not win the auction.
Because GSA Auctions wants to maximize the money earned, you will never know what the reserve price is. GSA Auctions returns proceeds to federal agencies and the Treasury.
There are no buyer fees, although some items may require a deposit to bid. You cannot sell items on this site because its only for government property.
Auction categories include:
Don’t Miss: What Is Bankruptcy Protection Chapter 11
What Are The Most Popular Online Auction Sites
The most popular online auction sites include eBay, eBid, Sothebys, Copart, Auction.com, and GSA Auctions. Most of these sites offer free buyer registration and allow winning auctions to be paid for with credit, debit, money orders, and cashiers checks. Some even provide in-house financing options.
Understanding Online Real Estate Auctions
Online real estate auctions usually take place because a seller wants to sell their home to the highest bidder as quickly as possible or because a bank has foreclosed on a home and wants to get the highest sale price possible for the home to reduce the amount of loss the lender suffers.
Regardless of whether an individual or a lender is auctioning a home, that auction will fall into one of three categories:
In all cases, once an auction is complete the seller must approve the winning bid. That approval can take 15 days or longer, and in some cases can result in the house being re-auctioned in an attempt to increase the amount of the winning bid.
Read Also: Is Taco Bell Filing For Bankruptcy
