Real Estate Auction (How Do They Work?)
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- October 2, 2018
Despite the dominant position in traditional Thailand Property sales processes, the popularity of real estate auctions is increasing every day. Previously, when there was no other way to liquidate the property, these auctions were described as disgraceful sales by troubled sellers. However, this view has changed as sellers of residential and commercial buildings choose to sell their properties directly in auctions or use brokerage firms to get the best deals, so the number of real estate auctions is increasing according to the rate market auction.
Auction opportunities arise when the spirit of the seller is auctioned to expect the property to receive a fair market price. In order to get a reasonable price, your capital position in the auction property must be strong. With a strong capital position in the property, you will save on the cost of paying sales commissions. When the market rises, the timing of the auction should be perfect. The auctioneer should also try to avoid the high maintenance costs associated with the property.
A profitable auction occurs when a particular type of real estate supply is limited and the demand in the Thailand Property market is relatively high or the market declines in favor of buyers during this traditional sales process.
When auctioning a property, it is urgent to bring the parties together on a certain day, and the sales process creates a bid between the parties.
In the early days of real estate auctions, only properties with poor auctions or foreclosures were auctioned. But now, sellers are turning to real estate auctions to sell homes. This shift is due to the former’s belief that the seller will not risk auctioning his property at a price below the market price. Real estate auctioneers are free to set a minimum price, which is higher than the market value they will receive under any circumstances. In addition, by setting a minimum price, if you do not reach this price, you will no longer have to bear the risk of buying back the property, and you will also save the cost of paying the sales commission required by the auction house.
Many Thailand Property owners prefer direct auctions instead of going to the auction house to avoid paying sales commissions to real estate agents, which is about 8% to 10% of the value of the property. . In addition, the owner has absolute control over the auction sales process. This is crucial when the property requires a lot of time to sell and the homeowner is represented by a real estate agent or broker. Many times, owners are advised to auction properties that are not used to reduce maintenance costs. Real estate auctions are an exciting event for auctioneers and interested parties.
Since auctions are the best way to gain real market value in the Thailand Property industry, the magic of exciting real estate auctions is selling these properties. It is the responsibility of the auctioneer to create demand or drive in the minds of buyers/bidders and to attract the attention of potential buyers/bidders. Potential buyers of real estate are registered after ensuring that they are financially qualified. It must be noted that the buyer pays a significant amount of money as a non-refundable advance payment and both parties are willing to complete the transaction as soon as possible. Before the auction, it is necessary to ensure that the buyer is financially secure so that the seller does not have to wait for full payment. People often find that real estate auctions are still incomplete because buyers are still buyers. So, buyer needs to have the money for auctioning.