I did mention about property auction in my earlier post. I went for property auction which was held at Equatorial Hotel, KL on the 14th March 2009. Manage to secure 1 low cost apartment at below market price. Reserved price RM38,000. There are 2 bidders + me = 3 bidders. Successfully transacted at RM43,000. Good price as the market price for low cost flat ard there can fetch to RM56,000. Near my parents house so easy to monitor.The process :
1) Search For them
You have to search in many source for any good property that are on auction. You have to get the information 1st. Information is free. You could get it from :
a) Auction notices in Newspaper
b) Auction notices at courthouse, banks, lawyer's office
c) Auctioneers
d) Bank Officers
e) The Internet (the easiest..at a click of a button) ie. www.auctions.com.my
f) Real Estate Agent (like myself huh)
2) Study the property
Hey! its not easy to get a good deal ok.. You have to do some works / study also...
a) Call the Auctioneer or Agent to get more details of the property. Ask :
1) Technical details : how many rooms, bathrooms, size, etc..
2) No of times the property has been auctioned off and prices at those auctions
3) No of people interested or inquiring about the same property. for you to have better idea of the competition.
4) Ask him to fax / email POS - Proclamation Of Sales. It state complete details of the property; the term & conditions, date n venue of Auction
b) Check the title of the property.
Go to land office and do the title search, you have to pay RM20-30 per search. Make sure 1 important thing : NO CAVEAT. Any caveat carry by the property = forget about it. Move on.. Other details to know abt the property; restriction-in-interest, need consent for leasehold..etc... ask agent..
c) View the actual property yourself.
Is it empty or occupied? Empty = Good Occupied = check is it worth bidding. If occupied by : Tenant stay :- Best if tenant willing to vacate the place. If not, ask neighbours about the tenant - any problems, good / bad tenant. If problematic tenant, just walk off. He has the tendacy to stay there and not paying rental which is the worst investors nightmare.
Owner :- U might have to think to walk off also. How if he doesnt want to vacate the house? You gonna face a lengthy process of police report, court order to get him out of the house which means more money to come out...
d) Set The Ceiling Price...Be Discipline
Discipline yourself and set a ceiling price for the property. Make sure it doesnt exceed the ceiling price esp.. market price. Dont ever be soo fool to buy auction property above market price. You are trying to make money out of the auction property..why should you pay above market price? I dont understand sometimes people are too emotionally carried away during the auction process and pay above the market price. Once it touch your ceiling price - walk off. dont wait.
Cont... Auction Process