Auction.com

[Marci Stein]

please tell me your experience on buying from auction.com.

i understand there's a starting price, then a reserve price,

which makes no sence-why not start the price at the reserve?

has anyone profited from a home bought on this site?

the reserve seems to be very high.

thanks!

[Kenneth Wong]

Hi @MarcStein,

I have successfully purchase, as well as lost out some properties on auction.com.

The reason for the low start price is to drive interest towards the property, so more people bid on it, and drive the price up. keeping in mind these are all cash deals, you need to be careful not to get too caught up in the bidding.

I was bidding on a property in Cooperstown, NY and for 3 days I was the only bidder at $18,500. The last hour of the auction, some knucklehead bid all the way up to $40k, and I let him have it. Ten days later, last Friday, I got a call from Auction.com advising that he reneged on the deal, and if I was interested in it at my last price of $38,500. It did reach the reserve at $38,000, mind you, but I only offered to buy it at my $18,500 price. It will be back on the auction block shortly...

My other property I was the only bidder, and won it in Newburgh, NY. And, it did not reach the reserve. I am closing on it shortly.

Do not forget the 5% premium that is added to the price, you really need to remember this fee, as it is added to your bid at the end- there are some crazy bidders out there.

Lastly, even though you might not hit the reserve, if you are the high bidder, auction.com will go through the motion of having you "buy" the property, and put down an earnest money deposit (EMD). The seller has 10-15 days to either accept your low bid or reject it.