Following bidding on Auction.com

6 Replies

Hey guys,

Been browsing the inventory on Auction.com. Found a couple of properties that I'm interested in. As practice, I'd love to crunch the numbers and come up with a price I think is fair, then compare that to the winning bid at the end. Is there a way to do this? Would I have to register for the auction? 

Thanks in advance!

T Ferreira

@Thomas Ferreira Jr. You can follow the sales price and the work backwards on the numbers. If you don’t want to wait, go on Realtor.com or Zillow.com and search your target area using the “recently sold” filter. You can then run your numbers based off that sale price and determine if the deal is a winner or not. I often do this then send the analysis to my realtor asking her why She didn’t get me that deal! “She’s loves those emails” 😂😂 One thing to note on your calculations. Don’t under estimate capital expenditures, vacancy rate and rwmo costs. I see new investors breeze over this all the time and it will always come back to bite you. Something will break / leak, you will go over on your Reno budget, things will take longer than expected and you will have some vacancy at some point. Plan conservatively and worst case, you have extra cash in the savings account at the end of each year that you can redeploy into your next deal.

For example, there are 3 properties on Auction.com I am interested in, but regardless of what they sell for I don't have the financing lined up. I'm just crunching numbers to see what I would be willing to pay for it if I was actively in the market for another property. I'd like to know what these properties do sell for, so I can compare to my number. Then I could get an idea as to how accurate my numbers are (if I'm consistently willing to overpay then my calculations are obviously flawed, same for if I'm coming out with a very low number). My first property kinda fell into my lap, and cash flows like crazy. Which is great, and is providing a ton of experience in most areas of rental investment, but I've got no experience w/ analyzing or financing these deals. I'd love to make boat loads of money, I would hate to lose boat loads of money. 

Also, I'm not trying to be "that guy" online. But you mentioned rwmo costs. Is that an acronym I'm not familiar with, or did you just hit the wrong keys while typing Reno? Not trying to nitpick, just wanna make sure I'm not forgetting anything.

Thanks guys, 

Loving Bigger Pockets, So much information

@Thomas Ferreira Jr. Also, just an FYI: those properties on auction.com may have liens on the deed so you have to be careful because once you buy the property and it’s under your name, you’re responsible to pay all the liens on that property. To check if they have liens, you can take it to your local title company but what happens if there’s a lot of properties you want to invest in, since it can cost some money to check the liens on the property, is there a cheaper way to verify this information so that you don’t purchase a 20,000 home with a 60,000 lien on it? That, I am not sure so hopefully someone who regularly invests in those properties can lighten us up.

@Thomas Ferreira Jr. it usually takes 45-60 days to get the property to close from date of auction (on auction.com)

So you need to wait until closing to get the final sale price for that property.

But per @Sergio Aguinaga that may not be the true total cost because  of possible liens.

@Ibn Abney Great point on the liens. I know I'd need to calculate that in my final offer but forgot that'd affect my feedback. Thought it'd be a great way to test my ability to generate accurate offers but I guess not when you figure in hidden liens. Such is life I guess. Having said that, what do you guys find is the best way to see property transactions? Is there any website that will send me automatic notifications when a property I'm following closes? Wishful thinking perhaps.