How to buy real estate at auction ? What are the steps to follow to buy a house, apartment, or just a plot of land at an auction? What are the participation requirements? Do you need to be of legal age, or can a minor bid at such an event? What is the average price of real estate?
Buying a property is a dream for many people. We're talking about the dream of owning a house , or an apartment, or simply a plot of land that's in one's name, so that one can call it "theirs." However, it was easier to buy a property in the past than it is today, mainly because of the overvaluation of real estate.
Today, a simple plot of land about 10 minutes away from a quiet town with 10 inhabitants can cost between 200 and 300 reais—absurdly so. When a house is already on top, that price almost doubles. Therefore, it's essential to find ways to buy property more affordably, and one of them is through auctions.
In today's content, we'll explain how to buy real estate at auction . So, if you're looking to buy a property at a more affordable price, you've come to the right place. If you want to know more about this topic, follow along to the end of the content for more details. Let's go, read on!
What is a real estate auction?
But what exactly is a real estate auction ? Before learning how to buy real estate at auction, you need to understand what it's all about. Basically, a real estate auction involves the sale of land, apartments, and houses that no longer belong to their previous owners, but are instead held by financial institutions or the government.
Thus, in most cases, it's possible to buy a plot of land near the city center, with a house already built on it (or currently under construction), for less than R$100. Wouldn't that be a dream? Unlike car auctions, these properties are in near-perfect condition.
This is because the processes of foreclosure and repossession of properties that are not paid for on their financing occur very quickly. Thus, about four months after missing one (or more) installments, the property is already available for auction. Continue reading to learn how to buy properties at auction.
How much does a property cost at an auction like this?
But what about the price of a property coming from an auction? Well, that depends a lot. It depends largely on the type of property we're talking about, that is, its actual market value. Therefore, there's no way to state a fixed price for all properties sold at auction.
However, just like a car or motorcycle auction, it's possible to consider the 40% rule. But what do you mean by the 40% rule? It's not a rule per se, but the vast majority of the most affordable auctions fetch between 40% and 60% of the market value of the item in question.
Thus, a car with a FIPE value of R$20.000,00 usually fetches between R$8.000,00 and R$12.000,00. Of course, there are exceptions where this "rule" is broken, which is why we say it's not a rule per se. The same goes for a property, which, valued at R$200.000,00, usually fetches between R$80.000,00 and R$120.000,00.
How to buy property at auction?
But how exactly do you buy real estate at auction ? This brings us to the main topic of our content, where we will explain to our readers what needs to be done to buy land, an apartment, or a furnished house at such an event. Read below:
- Go to the official website of financial institutions such as Santander, Bradesco, or even Caixa (Caixa's property auction is one of the most famous and sought-after);
- Search for a tab with news, look for an open auction notice with the date, time, and location of the auction, or a video conference link if it's online;
- Participate, bid and win your property;
- Regularize it at the relevant property registry office.
This was our guide on how to buy property at auction. See you next time!
