Can you find a good price at new home auction.?

Asked by Wayne Wang, Keller, TX Tue Jun 10, 2008

Does anyone know what the reserve price is when home builder unload their inventory in auction? Just wonder it is a good place to find a bargain. Also, is is necesary to have real estate agent for representation?

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4
Alicia Chmie…, Agent, Frisco, TX
Thu Aug 26, 2010
There's a couple different auctions you may be considering... that directly from the builder and the county if the bank has taken the property in foreclosure (which is happening to builders these days). In response to the latter, yes, you can get a "bargain" there sometimes. You will really need to know exactly what it is you're wanting to buy prior to the auction and what your max bid is/will be. In order to purchase at that point you must have a cashier's check in hand for the full amount. (No loans will be welcomed.) I'd highly recommend that you hire an agent to research the home(s) for you to help you come to your max bid prior to the auction date. Make sure that that agent has at the least been to an auction either for their own investment purposes or with an experienced investor so that way they really know how to advise you.

The disappointing thing I've found is that most agents have no experience or knowledge of how the process works. Experience on such a purchase is absolutely necessary!
0 votes
Dallas Texas, Agent, Dallas, TN
Tue Jun 10, 2008
YES, for a reatlor, do you understand contract law for a home purchase, you are covered under e & o insurance for an agent who is representing you. There are some auctions you are paying retail value, auction at times makes appear to be a deal when in fact it may not

Contact my office happy to assist you 972-699-9111 http://www.lynn911.com
0 votes
Lucy Puniwai, Agent, Haslet, TX
Tue Jun 10, 2008
I work exclusively in Keller and in the west Alliance growth project. In this area we do not see many builders unloading at auction because they are offering rock bottom prices to move in to their homes with associated financing. I do not believe it is necessary for you to have an agent at auction. The builder will prefer you to use their contract and as long as you read it carefully and have performed your due diligence on the internet, you can purchase that home on your own. As Bruce mentioned, if there are multiple bidders on a home, the auction price could be more than another builder would sell for in a one on one transaction.
I do receive email from builders in this quickly growing area so if you are interested in working with me , I will represent you until you find exactly what you are looking for!
I also receive email and postings on this site will confirm that not using a Realtor could cost you in hindsight.

Best of luck!
lucy@webuyitwesellit.com
0 votes
Bruce Lynn, Agent, Coppell, TX
Tue Jun 10, 2008
I normally see about a 20% discount, but every auction is different. It really only works if there are several bidders for the same property. When there are several bidders then bidding can get out of hand and I see properties go over normal retail value. If only one bidder then often the properties will go cheap. I always think it is a good idea to have representation. It does not cost you anything and an extra hand on deck to watch the auction watch you bidding and go over the contract with you is never a bad idea. I've bought a property at auction and it was a good experience for me. I regularly attend the auctions as well if you need assistance.
Web Reference:  http://www.teamlynn.com
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