Hey one, hey all. I dont know if Im posting this in the right place but i had a question.
i plan on going to a auction this Tuesday. I dont plan on buying or bidding on anything at all, rather I'd like to see what happens, how it happens and maybe more importantly WHO's making it happen.
Im really very new, havent got a deal yet, but Im thinking it couldnt hurt to meet some cash buyers just to introduce myself and maybe get their contact info for future reference.
I live in the Houston area and there are 2 auctions I know of; 1 for Harris county and the other for Fort Bend county. The problem is they are both held on the first Tuesday of the month at about the same time of day.
So my question is to anyone in the area whos has gone to these auctions. Which one of the two would you recommend going to?
Which one usually has more action, more players, more that I could watch, listen and learn from?
Any help, advice, or opinion is more than welcome. Thanks for reading.
First off, I've never been to the Fort Bend auction, so I can't compare the two. However, first ask yourself what your intent is for going in the first place is. If just to observe the frenzy (i.e. circus) then either should provide you the entertainment. BUT if you're going as a future buyer, then you need to go to the auction in your "farm area". Maybe you don't have that quite defined yet, and that's ok. But generally go to the one you think you'll buy at in the future. These are good networking opportunities.
Keep in mind, there is also the Bank Foreclosure auction at Harris County in another part of the event center. Might be at Fort Bend too, I'm just not sure their format. But banks are required to hold their auctions on the first Tuesday as well, so I presume so. The bank foreclosure auction is much closer to a cattle auction (my upbringing is showing itself here)...fast pasted, a true auction-style. Sheriff sale is slower paced, but often very difficult to hear or know what property is being auctioned. The digital output on the screens helps.
I've bought one bank foreclosure and one tax sale in the past year. Both were purchased at a price that I can (or already have) made money at, but the competition at Harris Co. is really stiff - I've heard more so than Fort Bend but I'll let someone w/ experience in both confirm. There have been properties I've been interested in that people pay near fair market value for a house they haven't seen the inside of. I have a healthy appetite for risk, but I calculate risk into every target I have at the auctions and its my conclusion that I'm more conservative than most investors. Explains why I've only bought 2 properties. But one we rehabbed/flipped for +$80k net, and the other is a fantastic town home site overlooking downtown that I'll either develop myself or flip to a builder for $40k or so net (we've currently got the existing structure rented to be cash flow positive and bide us some time during the redemption period to decide). But I've targeted an average of 3 properties each month for about 10 months now, so you can do the math here.
I've been going to the auctions for only a year, so I don't offer much history. But I'm curious what your intent is, and how the auctions might contribute to your investing strategy? Figure that out first.
@Mark M. I went to the Harris County Auction last month. Considering that it was my first time there, it all seemed like a mad house to me. You have sheriff auction from all five precints, trustees auction, and people from auctions.com there. If this is your first time, I would recommend hooking up with the meetup.com group there. Link is here
https://www.meetup.com/Houston-Beginner-Real-Estat...
Linda will give you a tour of the place and what's it about without the bs. Of course she'll give you the education pitch at the end of the tour, but the tour itself is worth the pitch at the end.
Careful not to get caught up in the hype...I personally witness some crazy bids that I didn't understand where they were coming from. I don't know if they got caught up in the bidding process or they have a fix strategy that I couldn't figure out.
@John Vo thanks for the response. I read another post from a BP member from 2 years ago and he described the whole Harris county auction process and he said the same thing that it was really a mad house, everyone crammed in real tight, auctioneers not speaking loud enough and maybe didnt know what they were doing, people (maybe newbies) bidding up the price to or above retail....just madness.
But it is something I'd like to see and more important meet some of the investors, people who are actually buying properties and doing it.
I might hook up with the group you were talking about, my only concern is them taking away time from seeing the action and meeting the players, but it might be wise for a first timer to go with someone who can show me the ropes once inside .
Bad thing for them is, thanks to BP there really isnt any way i could see myself coughing up any money for information that i can get here for free.
First off, I've never been to the Fort Bend auction, so I can't compare the two. However, first ask yourself what your intent is for going in the first place is. If just to observe the frenzy (i.e. circus) then either should provide you the entertainment. BUT if you're going as a future buyer, then you need to go to the auction in your "farm area". Maybe you don't have that quite defined yet, and that's ok. But generally go to the one you think you'll buy at in the future. These are good networking opportunities.
Keep in mind, there is also the Bank Foreclosure auction at Harris County in another part of the event center. Might be at Fort Bend too, I'm just not sure their format. But banks are required to hold their auctions on the first Tuesday as well, so I presume so. The bank foreclosure auction is much closer to a cattle auction (my upbringing is showing itself here)...fast pasted, a true auction-style. Sheriff sale is slower paced, but often very difficult to hear or know what property is being auctioned. The digital output on the screens helps.
I've bought one bank foreclosure and one tax sale in the past year. Both were purchased at a price that I can (or already have) made money at, but the competition at Harris Co. is really stiff - I've heard more so than Fort Bend but I'll let someone w/ experience in both confirm. There have been properties I've been interested in that people pay near fair market value for a house they haven't seen the inside of. I have a healthy appetite for risk, but I calculate risk into every target I have at the auctions and its my conclusion that I'm more conservative than most investors. Explains why I've only bought 2 properties. But one we rehabbed/flipped for +$80k net, and the other is a fantastic town home site overlooking downtown that I'll either develop myself or flip to a builder for $40k or so net (we've currently got the existing structure rented to be cash flow positive and bide us some time during the redemption period to decide). But I've targeted an average of 3 properties each month for about 10 months now, so you can do the math here.
I've been going to the auctions for only a year, so I don't offer much history. But I'm curious what your intent is, and how the auctions might contribute to your investing strategy? Figure that out first.
@Jonathan Williams great advice, and congrats on buying 2 properties youve either already profited from or will profit from. As far as your risk level goes, I'd say you're actually being smart and disciplined (not buying anything unless you're making a profit as soon as its bought) which what i believe you NEED to do in order to not only survive in this business, but to thrive.
As for my farm area, No, i havent decided that or figured that out yet. I really dont have enough knowledge or a preference yet. I wouldnt mind if i could stay close to home, but I also have no problems going out a distance. My current business affords me the ability to go where i want when i want and the time to do it, so Im completely open. I guess I'd just have to try to make a deal happen SOMEWHERE and take it from there.
Concerning my plans for the auction Im not so much interested in going to the "circus" (LOL) as I am learning the process and more important meeting people who are actual cash buyers. Get their info and possibly do some business with them in the future.
My intentions for RE investing right now is to assign contracts. Hopefully after I've assigned a contract I'll have built enough of a relationship with the buyer that maybe they'll let me watch or observe what and how they do with the house after they buy it from me, maybe even act as a semi - quasi project manager so I could learn some skills to apply toward my own investing. Ultimately I want to buy enough houses that i could choose which ones I want to flip and which ones I want to hold for long term passive income.
The way i figure it, once I buy my first property it'll be smooth sailing from there and the money will just start rolling in........right?
@Mark M. Did you make the auction yesterday? Which one did you go to and how was it?
If your intention right now is to network and meet people, you'll benefit more from going to as many MeetUps as you can instead of the auction. I've not been to an auction here in Houston yet, but judging from what I'm reading, it's a Circus. It doesn't sound like the best place to meet/network with people. At the MeetUp's you'll find a more relaxed atmosphere and you'll meet people serious about investing.