Risks and Benefits Of Buying A Property At An Auction - WHAT YOU NEED TO KNOW!

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#auction #investing #propertyadvice

In this episode I share with you the things you need to know before considering buying a property on auction. I explain and share with you, the three basic types of sales that fall into this category, where to find repossessed properties for sale and the Benefits and Risk of buying a property on auction. I explain how auctions work? what to expect - what to do.
Auction sales are on the rise in South Africa and have grown by a huge margin during the course of this year. However, despite the trend, it would be wise to realise that buying a property on auction does not necessarily mean that you will always be getting a good bargain. Before buying anything, a purchaser should always be aware of all its obligations. It is important to know the rules of the auction game long before you decide to get involved, which is regulated by section 45 of the Consumer Protection Act 68 of 2008.
At an auction bids are open. You know what the buyers you are competing with have bid and, if you want to secure a given property, you only need to beat that bid by a small amount.

Timestamps
0:00 Intro
2:50 The 3 types of property
3:21 What does bank mandated sales mean?
4:16 What does property in possession mean?
6:51 Where to find repossessed properties for sale
6:51 Benefits of buying at an auction
7:30 Risks in buying at an auction
13:04 How does auctions work?

On the day of the auction
1. Register as a bidder and get a number or bidder’s ‘paddle’.
2. You will need your ID document, proof of your residential address (such as a municipal account), and the registration fee, usually payable by EFT or bank guaranteed cheque and is fully refundable if you decide not to bid after all, or if your bid is unsuccessful.
3. If you are bidding on behalf of someone else or a close corporation (CC) or a trust, you will also be required to complete the registration process. You may also be asked to sign an undertaking accepting responsibility if the person or entity drops out after a successful bid.
4. If your bid is immediately successful and not subject to approval, you will need to sign off on the conditions of sale confirming your purchase of the property.
5. You will be required to pay the auctioneer’s commission (usually 10% of the buying price plus VAT) and a deposit of at least 5% of the buying price, less your initial registration fee. The balance of the buying price will only be payable on transfer of the property.
6. Remember to double check when the risk in the property passes to you before you leave the auction site. This will either be on fall of the hammer or on registration of transfer. This is important to allow you to make the necessary arrangements for insurance.
After the auction
Should you default on the sale after the auction, the seller will have the right to take legal action against you as you have signed a legally binding agreement.
If you can navigate the auction market properly, you may find a bargain
Familiarise yourself with these key essentials and it is possible to hunt down a bargain property that is being sold on auction.
Here are some of my previous videos:
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BUYING A PROPERTY vs RENTING A PROPERTY (Advantages vs Disadvantages) #PropertywithLeonard

FULL PLAYLIST: Property with Leonard #propertywithleonard

Should You Rent or Buy a Home When You Retire? #PropertywithLeonard

How To Budget For A Single Income Household #PropertywithLeonard

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Timestamps
0:00 Intro
2:50 The 3 types of property
3:21 What does bank mandated sales mean?
4:16 What does property in possession mean?
6:51 Where to find repossessed properties for sale
6:51 Benefits of buying at an auction
7:30 Risks in buying at an auction
13:04 How does auctions work?

[gudaninetshiunda]

Thanks for your information... I really appreciate it 🙏.

[beaudene]

"risk as they say is absolutely fundamental to investing but you can limit your risk significantly by doing your homework" 🙌🙌

[natashamohamed]

very insightful and will be following and subscribed, thanks

[RajeshDevkota-dukz]

Hi - I am trying to find properties in Minnesota can you able help ?

[belindaneo]

Thank you so much. This was such great information especially for a first time buyer.

[rizaanjappie]

Good advice, I need to pursue the auction options

[mukbangdialam]

Keren Mantap, , terimakasih sudah berbagi, , sukses dan sehat selalu beserta keluarga, , Amiin🤲

[brianchakuma]

Rawson properties want to sell my house for me through their auction sale, they say I won't have to pay agents commission claiming it will be paid by the buyer that's how the auction sale works they say.
My question is, is this safe?

[andyafrica]

Thanks for a great video
I've subscribed
Is there a website you would recommend to shop for property on auction?

[zolaphungula]

Thanku, do they allow you to view before the deposit

[surpriseTheManoeuvre]

Hi Leonard, hope you're doing well?
Could you kindly enlighten me on how I can get people to invest in this property idea I have? myself I have no capital

[saneliswamavimbela]

Hi, When you buy in auctions, is it strictly cash or you can be financed by banks for montly repayments?

[tendaniramutsindela]

Hi, does this mean that if i win the bid, i have to pay the whole cost of the bid in 21 days. Are there terms of payment that can be agreed upon