If you are on the market to buy a new home, we are sure you have heard that you can get great deals at an auction. As a seller, too, an auction can be a lucrative option for investing. However, an auction is not for the faint-hearted and a great deal of preparation must go in before participating. Gumtree outlines the pros and cons of buying a home at an auction:
- Houses bought in the traditional manner can take months to complete. However, the process of buying an auction home can be completed in as little as 28 days.
- Homes that are being auctioned off are available at excellent prices. So, if you are looking at a ‘fixer upper’ or just one to invest in, these properties may be perfect for you.
- An auction process has full transparency as you and all bidders and interested parties are present in the same room.
- If you decide to invest in a house at the auction, you will have to put in a deposit on the same day. You will also be given a certain time period in which you have to pay the total purchase price.
- As this is a short process, your regular due diligence before buying a home can be adversely affected. You may not have enough time to conduct surveys or check the legalities of the property in time. Thus, the opportunities to inspect and monitor are limited.
- There is always a possibility that someone outbids you on that dream home. However, you can always bid higher but remember to stay within your means. It can be very easy to get carried away!
Now that you’ve got the knowledge, it’s time to shop! Head to gumtree.co.za or your Gumtree app (click for Apple & Android) and don’t forget to use your location settings to find local property information close to home.