Lafayette, LA · Member since 2015 · 2 posts · 0 votes
I’m new to real estate investing and have been looking at Auction.com for possible flip properties. The first property I was interested in had title issues, so I decided to pass on it. That experience made me more cautious about buying through Auction.com.
For those with experience, what research should I complete before placing an offer on a property through the site? What should I know before bidding so I do not get in over my head on my first investment property?
I’m mainly trying to understand how to limit my risk when buying through Auction.com.
@Lane Duplechin Hot take; don't buy your first investment property on auction.com or any auction for that matter.
The risk to reward is pretty dangerous for someone just starting out. It depends on the property status, but interior access is generally not permitted before bidding. It's an unknown budget busting trap that inexperienced investors fall into. Don't make that mistake. Look at houses where you can do a walk-though, calculate a rehab budget, take detailed pictures, and avoid the pit falls instead of blindly buying them.
After you get some experience, build a team, and understand the basics that's when you could attack auctions. In our market the auctions rarely yield a better deal. I've attended a few virtually, tracked the numbers, and actually evaluated exterior condition of the properties, the yard, and the surrounding neighborhood. The auction prices s**ked. The value add BRRRR strategy would have been hard to pull off. I could find/buy/create my own deal by walking more listed properties, negotiating harder, networking with other investors, and working with local wholesales who sell properties everyday. Turn yourself into a solution for someone else and deals will find you.
@Jaron Walling This is great information. I really appreciate you sharing your experience with the site and your strategy for finding properties through other sources.