Majoring in finance and having a big interest in real estate, this past month I went to see my first auction for a property. A property that goes to auction is due to the fact that the owner can not pay his mortgage or he is not paying his property tax. Auctions are a big part of real estate because it’s a great way to get a good property at a wholesale price. Auctions are usually held in government courtrooms and sometimes in hotels and online. For the auction I attended it was held in a courtroom. I got in sat in a pew and watched and learned as real estate investors tried to get their hands on a property. This was an absolute auction, which meant that the highest bidder would be given the property. I learned that the bidding typically starts with the remaining balance of the mortgage, and this was the case here. As they started the auction people started the bidding, the number increase by each buyer was shocking to me because they were outbidding each other by a pretty large margin. They continued to bid until the highest bidder was left standing. The judge banged his grapple and the property was his. I learned that the winner must come with some form of money, either cash or check to pay an auction fee.

I learned from this experience how an auction works and the benefits of purchasing a property through auction. It offers a first chance to buy a property that has not yet hit the market. Since purchasing a property through an auction comes with much more of a risk you tend to be able to get them at a much lower price. Going to an property auction was one of the most learned experiences of my life because it taught me so much about a business that I see as being a future profession.