Author: MC du Toit
CEO for BidX1 South Africa
23 February 2021
Online property auctions: Dos and don’ts for sellers and buyers
Buying and selling property via online auctions is becoming far more commonplace. Ensure you have done your homework, researched the market and viewed all available information on the property before bidding. Follow this advice before you get started.
Buying property on Auction can be daunting and a slightly emotional experience. But it is also a convenient, effective and transparent process, says MC du Toit, CEO for BidX1 South Africa. He shares the following useful tips for sellers and buyers of both residential and commercial property:
Tips for sellers
Listen to the market. BidX1 offers the seller analytics on their property which will allow him/her to see exactly what the feedback is from interested buyers. As there are limited buyers, particularly in the current market, ensure you take this into account when considering an offer.
“I always advise sellers to try to distance themselves from the emotional aspect of selling their properties. This is easier with commercial property, but in selling residential property, for example, your home, it is probably even more important. Once you have achieved a sense of impartiality and tried to view your home with objective eyes, ask yourself what you would pay for the property,” says Du Toit.
“When you receive an offer, do not reject it outright. First, sit with one of a professional estate agent and look at the offer carefully. Ask the question – why did I get this offer? So often I have seen sellers rejecting good offers, to only sell the property three to six months later for less.”
Don’t be blinded by the prices of other properties on the market in your area, or even what your neighbour’s property is being marketed at, as it is most probably not what they will sell for. It’s a good idea to first view the bidding and sale of other properties online.
Tips for buyers
Ensure you have done your homework, researched the market and viewed all available information on the property before bidding.
Talk to a specialist property professional who can advise you on any questions you may have.
When bidding, do not exceed what you can afford, so before you start bidding ensure you have decided on your limit and then stick to it.
Don’t make the mistake of thinking that a property will receive bids way over what you are prepared to pay. “I have seen numerous buyers lose out on a property when they made their own assumptions that a seller will not accept their offer, or that other buyers will bid more than they are prepared to pay – resulting in their missing an opportunity to acquire a desired property which may even be their dream home,” says Du Toit.
Some buyers say post-auction, ‘but I would have bid on that property’, and my question to them is why didn’t you? So ensure you are registered to bid as you never know.
“Our online process makes it easy for bidders not to miss out as you don’t need to reschedule your diary to travel to a specified venue to bid – you can bid from anywhere on any device. This means you can always ensure you are in with a chance to buy the property,” he says.
“You will need to register to bid, but you have nothing to lose as registration deposits are fully refundable while your day won’t have been disrupted with a chunk of time wasted.”
Du Toit says the process is safe, as bidders have to register first and provide FICA documentation as well as source of funds, eliminating any fictitious bids being placed. It’s also transparent, as everyone can see the bidding as it unfolds, plus it’s also recorded, so anyone can view the bidding for properties sold via our previous online auctions.
“Before participating, I recommend that you physically inspect the property at one of our viewing days, download and fully understand the conditions of sale and read all the relevant information regarding the specific property, all of which are available on our website,” he says.
An opening bid is declared for each property or lot, which is the price at which bidding will commence.
“To bid, you need to register – generally with payment of a fixed registration fee which is fully refundable should you not be the successful bidder. If you are successful, a deposit of 10% of the amount bid will need to be paid.”
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