Online Auctions: Buying your Home Online
May
5
Written by:
5/5/2010 5:56 PM
Ecommerce is rapidly expanding to the real estate market. Sellers are looking to auction off down payments, lease agreements, or selling the home outright. Individual homeowners and real estate agents are turning to the Internet as an avenue for sales. Buying your home online can be a risky venture. On the flipside, there are some great deals out there. If you decide to take this path, you should be aware of the challenges associated with buying a home site unseen. The more educated you are, the better.
First of all, the home could have major structural issues not evident in an online picture. Pictures don’t always tell the whole story. It has also become much easier to doctor photographs. You have to consider the possibility that some sellers might not be as truthful as they should be. After all, they are trying to sell the property, so the sales description is going to emphasize the positives and downplay the negatives. Getting a fixer upper is one thing. Living in a house that is structurally unsound is a completely different matter.
Secondly, you must make sure that you know your property rights. If you are buying land, you must make sure that you can have the utilities you want. There might be restrictions that are not specified on the auction site. There would be nothing worse than buying the property for your dream home and then discovering that you cannot have utilities.
Another potential hazard to buying your home online is not knowing anything about the area. It would be well worth your time to do some investigating. Is the property in an area that is prone to flooding? Is the property accessible by car? These are things that the seller might not mention in their ad.
Also, it is easy to become a victim of online fraud. There is really no way to regulate the online auctions. The auction companies have their own guidelines in place to circumvent illegal activity, but with the high volumes of online business activity every day, it is hard to police every transaction. The government may eventually step in and try to pass laws that will protect online consumers. Time will only tell, so until then you have to keep your guard up.
On the positive side, it is important to note that online auctions are not legally binding. The companies are not actually licensed to sell real estate; therefore, they are not true auction houses. The service that they offer is advertising to potential buyers. It gives buyers and sellers the opportunity to communicate with one another online and work out a legally binding contract after bidding ends.
When placing an eBay bid online, you should be aware that there are two types of bids: “Binding” and “non-binding”. The term binding is not entirely accurate because it does not result in a legally binding contract. A Binding real estate auction means that you have placed a bid with intent to buy. If you don’t live up to your end of the transaction, you will receive negative feedback. It won’t result in legal problems, but it can hurt your business potential on EBay. Everyone looks at the feedback and most people won’t do business with someone if they have a lot of negative feedback. A non-binding bid simply means that you cannot receive negative feedback if you fail to complete the transaction.
Always take the time to review the auction companies’ policies and procedures. There should be a link to them on the main page. If you have trouble locating them, contact the company directly. You should be able to email them any questions that you may have and they should respond to your inquiries quickly. Try to talk to people that have a lot of experience with doing business online. It seems like just about everyone has some experience with online auctions. They may have some horror stories, but don’t let that discourage you. You can learn a lot from the mistakes of others. If you prefer reading to chatting, there are also several books about the subject. Visit the technology section of your favorite bookstore and you are bound to see a possible resource. Take all of the advice and use common sense when entering into an online real estate deal. You will emerge as the winner and have a fabulous home to show for it.