There’s tips on buying real estate at auction in Pensacola. Looking to acquire an investment at an auction? That can be a fun (and potentially profitable!) way to acquire properties but it can also be fraught with danger if you’re not careful. Make sure you read these 4 tips on buying real estate at auction in Pensacola to help you do it right…
The secret to most real estate investing is to buy at an attractive price and then either rent for cashflow or sell at a higher price. And one place to buy attractively-priced properties is at the auction… if you do it right.
Unfortunately, many brand new investors swoop into the auctions and end up spending too much. If you want to avoid this “newbie” mistake, make sure you read these 4 tips to help you do it right.
Tips On Buying Real Estate At Auction In Pensacola #1 — Research
If the auction posts information about each property before the auction, take the time to do your research and determine the value and potential return of the property. Can you rent it out? Can you flip it profitably? Can you improve the value? Will you earn a return on your investment?
Spend the time to do your research and figure out how much you can make from the property, which will inform you about how much you can pay. Set a firm limit and don’t over that limit for each property.
One more important thing. Always trust your numbers and never go with the flow. What I mean about that is, if you already calculate the numbers on a real estate investment property, and you came up with the most money logically you can spend to buy it. Don’t bid more for that property because other real estate investors are bidding on it.
You came up with the numbers and you likely did it a lone. Make sure you’re discipline when you’re on the hustle ground on that computer trying to acquire that piece of property. Besides, what’s work for other real estate investors not necessarily works for you. Simply because their investing strategy could be different than yours.
There’s also another reason why you shouldn’t over spend money on buying a property at an auction. You’re paying cash! And not only because you will be paying for a property more than you should. You have to keep in mind that hard assets like real estate is hard to liquidate. Meaning it will take time to sell for you time more money in your bank account.
One of the bad advises you hear sometimes from real estate guru. Is cash is not king asset is. It’s half the true but not the full truth.
Cash is important to have. You could have ten million dollars in real estate assets. but if you ran out of cash. You will have your power at your own home get cut off for non-payment.
The bottom line is. Real estate assets are great to have and to create wealth. But keep in mind that’s a hard asset it’s slow and hard to liquidate.
Tips On Buying Real Estate At Auction In Pensacola #2 – Find Hidden Gems
An auction is an open, unfiltered market, which means that you’ll be up against other people who may have done their research and want the real estate for the same reasons you do. This can result in properties being bid up to a very high price.
The way around this is to dig deep in your research to find the hidden gems… the ones that people might not bid on but that YOU know are really valuable.
Tips On Buying Real Estate At Auction In Pensacola #3 – Wait Until The End
There are different kinds of auctions but if you are at a time-based auction where the deal stops accepting bids at a certain time then swoop in at the last moment with your best offer. If you time it right, you may give the best price and lock it in before anyone else can bid higher.
But there’s probably there’s other real estate investors do the same thing. So probably not going to work every time, but you have a higher chance to get the property than early on the bidding stage.
So, best practices is to bid twice in the end of the bidding period. one few minutes before it ends. And one few seconds before it ends if someone already bid higher than you.
Tips On Buying Real Estate At Auction In Pensacola #4 – Avoid Emotion
One of the hardest parts of bidding at an auction is that you can get caught up in the emotion. At first, you are thoughtful and calculating but then you might get into a bidding war with someone and your emotions take over. And soon you bid higher and higher just to beat the other person.
Remind yourself to leave your emotions at home and make sure you know what your upper price limit when the heat is on!
Getting into a bidding war doesn’t benefit anyone except the bank, or the county if they’re taking position of that property.
You can get easily caught up in bidding war, specially when it comes to big money investments like real estate, Not only in real estate auctions. But also in marketing as well.
For example, PPC (pay per click) ads with google. For google to get the most out of marketers. They rank their ads based on bidding for the keywords that they want to rank for. In the real estate business specially. Investors get into a bidding war to rank higher for them to get the most result and leads from the ads.
Also, to take the deals from each others. Because if I rank higher I will likely get the sweetest deal possible. The problem with that is you can accumulate marketing spending very quickly. You probably get some leads, and maybe close on some deals. But I can assure you. They will be some expensive leads, and even more expensive deals.
Acquiring investments at an auction can be a great way to buy real estate. However, if you’re not careful, it can also be very expensive. Use these strategies to help you avoid the mistakes and pitfalls and acquire low-priced investments.
At EliTrust real estate investments LLC. We provide real estate investors with the best real estate deals possible. We are working very hard to save you time, which is the most valuable asset we have. And save you marketing money when you have real estate good deals coming at you with no effort.