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real estate auction

Foreclosure Investment In Canada: What You Need to Know

Author: Robin Liu, Sept 20, 2015

Current foreclosure market in Canada
The foreclosure market in Canada has been growing for some time since 2008 when foreclosures flooded the American real estate market. The figures for the number of foreclosures in Canada are not yet fully known because this information is not publicly announced like in the USA. But the experts in real estate point out that the situation for foreclosure has been brewing for some time, and many families faced foreclosure during the recession period since 2008. During that recession period, a number of foreclosure properties were available in Canada. This motivated the real estate investors to pitch in with their bit and buy such properties.
If you have been waiting in the wings, anticipating a foreclosure purchase then you must know that there has been a slight decrease in foreclosures since the beginning of the year 2015, even though Canada economy went into recession again from the last quarter of 2014. That is mostly because of the decease of interest rate and our dollar value.
But if you are looking for a good foreclosure property, you must know that there are still some opportunities around, and you just have to look for them. Even so, the decrease in foreclosures has been pretty soothing for the homeowners.
Procedures in Canada foreclosure
There are two kinds of procedures in Canada foreclosure investment. One is called Judicial Foreclosure, and the other, Power of Sale. In a Judicial Sale, the lender should petition the court to receive the permission to sell the property in foreclosure. Provinces like British Columbia, Saskatchewan, Manitoba, Alberta and Quebec follow Judicial Sale procedure. Nova Scotia has a similar procedure, only difference is, it is called Mortgage Foreclosure. The provinces of Ontario, New Brunswick, Newfoundland and Prince Edward Island use the Power of Sale procedure. In this, the lender has the freedom to sell the property without asking for permission from the court.
Before becoming a foreclosure investor, you must realize that your dealings would be mostly with the bank and the homeowner. The bank would want the maximum amount with the least hassle, and wouldn’t be willing to budge when it concerns the property, and the homeowner would not want to let go of his property.
Making foreclosure investment in Canada
The process of foreclosure may be slightly similar in the U.S. and Canada, but the rules may vary from province to province. But the things that you must do before buying a foreclosed home remain the same. For example, it is imperative that you must inspect the home thoroughly before buying it. Sometimes you may have to invest in significant amounts of cash to get the repairs done in the house, so it must be a risky move for you. Or perhaps, the location didn’t suit you. And if the neighborhood is not as good as you thought it would be, then your investment would after all not be a sensible one. You can renovate and repair a home, but not change the location or neighborhood.
There are plenty of ways in which you can make your investment successful. You only need to tap at the right places and seek the help of the right person. If you are a seasoned investor, you would understand the benefits and pitfalls in making an investment in foreclosure. The auction is the best place to buy a foreclosed home. But you have to follow the proper procedures, including proper home inspection prior to making the purchase. The information of The Basics of Buying Foreclosures At Auction (link: http://www.bidwin.org/community/page/Buying-Foreclosures-At-Auction )is very helpful to you.
You can also find a complete set of Foreclosure Tutorial (link: http://www.bidwin.org/community/page/Foreclosure-Tutorial )in the Help Community of Bidwin.org.

Robin Liu is the founder and CEO of Bidwin.org (link: http://www.bidwin.org ), the first online real estate auction marketplace in Canada. You can follow him on his blog (link: http://www.bidwin.org/community/blog) or Twitter (link: https://twitter.com/bidwin_org ).

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real estate auction

How To Conduct A Combined Auction of Online and Live?

Author: Robin Liu, Bidwin.org
Dec 25th, 2019

A few days ago, a real estate auctioneer Bill from Toronto contacted me and asked me for a solution to integrate online auction with ballroom auction.
He was going to conduct a ballroom auction to sell 20 pieces of land spreading around the city he business is located in. He was also planning to list these 20 pieces of land on my auction platform bidwin.org for online auction. The online bidding will start 14 days prior to ballroom auction date, and will end with the hammer down in the ballroom. Ballroom people will bid on one property at a time. For each property, once the ballroom bidding starts, there will be bids coming from both online and ballroom people. The integrated system should enable the online bidders and ballroom bidders to interact as if they are all in one ballroom auction, that is to say:
1, Once the ballroom bidding starts, all the time the auctioneer must be able to see and know the winning bid from the online bidders, so that he always knows the next price to call out to the ballroom audience.
2, the online bidding must be transparent to the ballroom audience, that is to say, all the time the ballroom audience must be able to see the winning bid from the online bidders.
3, the integrated system must immediately transfer every bid from ballroom into online auction system so that every online bidder can know the new winning bid. The online bidders can not see the ballroom. All they can see is the current price(the winning bid) on the webpage on their bidding devices such as desktop computers, tablets and smart phones. The integrated system must make the ballroom bidding transparent to online bidders as well.
4, once the ballroom bidding starts, the closing time for online auction should be change to Indefinite. Auction is announced as closed when the winning bid standing unchallenged for 3 minutes. The auctioneer’s final three calls before hammer down should also be broadcasted over internet to all online bidders.

Let us first clearly understand what is a ballroom auction and what is an online auction.

What is a Ballroom Auction?
A ballroom auction, also called the live on-site auction, is usually conducted in a meeting facility or a room such as a hotel convention or indoor location. The auctioneer stands before the audience and onlookers and calls out the bids and asks for higher bids on the property being sold.

What is an Online Auction?
Online auctions are conducted over internet. There are no on-site bidders and on-site auctioneer. Online auction bidders compete on a service or product and submit their bids online or over internet. Online auction has specific timelines(opening and closing dates). Where online auction differs from the webcast auction is that while it is held on the Internet, it is not a live auction. There are no live bidders and no live auctioneer.

I should say that my auction platform bidwin.org is designed to work for this scenario, and my complete solutions for it is:
1, in the auction platform bidwin.org, create an account called “Ballroom-Bidder”. This account will be shared by all ballroom bidders. Every bid from the ballroom audience will be submitted to the auction platform under Ballroom-Bidder account.
2, in the auction platform, set up the online auction for the property to be sold. The start date of the online auction should be a date 3 to 14 days before the ballroom auction event. The closing time of the online auction should be half hour after the start time of the ballroom auction event. The start date and time of the ballroom auction should also be announced on the bidding webpage, so that every online bidder knows that they will be also competing with ballroom bidders and when that will happen.
3, on ballroom auction date, in the ballroom, get a laptop computer, projector and Internet access ready. Connect the laptop to the projector using a VGA cable and project the computer screen onto a white wall. The white wall should be in the front of the ballroom so that the audience and the auctioneer can conveniently watch it.
4, have an assistant sitting beside of the laptop. The assistant logs in auction platform bidwin.org as user “Ballroom-Bidder”, and navigates to the bidding page of the property to be sold.
5, When the auctioneer announces the start of the ballroom auction of that property, the assistant clicks on a button “Ballroom Bidding Now Starts” on the bidding page. Once that button is clicked, the closing time for online auction is changed to Indefinite, and auction will be announced as closed whenever the winning bid standing unchallenged for 3 minutes.
6, whenever there is a new bid coming from the ballroom audience, the assistant inputs that bid into auction platform, that is to say, every new bid from the ballroom audience will be submitted to bidwin.org auction platform for the same user account “On-Site Bidder”. Assistant should use a sheet of paper to write down the bidder’s bidder # and his price for tracking of on site bidding.
7, auction will be announced as closed whenever the winning bid standing unchallenged for 3 minutes.

Categories
real estate auction

What Happens If Mobile Internet Bidding Used for Real Estate

By Robin Liu, Jan 13 of 2020

Internet Bidding has been very successful for selling goods since 1995, but not for selling real estate until 2008.
Internet bidding has been used by eBay for buying and selling goods and services worldwide since 1995. Buyers and sellers all enjoy the continence and efficiency of online auctions. Since auction is not the conventional way of buying and selling real estate, Internet bidding did not have a successful story in selling real estate until 2008 when the real estate bubble burst. For a long time, people have the myth that auction is the last resort and only works for distressed properties.
Internet bidding has been successful for selling real estate since 2008, but only for selling distressed properties.
In 2008, Auction.com took the lead in conducting online real estate auctions, but Internet bidding was mostly used by auction.com for the disposal of distressed properties.
Since 2008, foreclosures have flooded US real estate market and several companies like auction.com have been very successful in using Internet bidding to dump these distressed properties, which also made auction a more widely accepted sales method. In recent years, auction.com has begun to sell non-distressed properties by online auctions, and they have been doing very well so far.
Nowadays, distressed property has not been the only type of asset that can be sold by auction. More and more non-distressed properties, including residential, commercial assets as well as agricultural properties, are being sold at auctions. In Australia, auction is the prevailing method of buying and selling real estate. Obviously US have been going that way after the burst of real estate bubble.
What will happen when mobile Internet bidding is used for real estate transactions?
With Internet bidding, bidders can submit bids without personally attending the auction. However, online auction requires bidders to submit a bid and then wait for the next higher bid, sometimes bidder has to wait for a few days, sometimes just a few seconds. With mobile Internet bidding, bidders can submit a bid at anywhere any time, and then they can go anywhere and do whatever things they want to do, as long as they have access to mobile Internet. A bidding App can be developed to further facilitate the continence and easiness of mobile Internet bidding.
More than 60 % of Internet Traffic Now Comes From Mobile Devices
Technologies are evolving in an accelerated speed, which is also changing the way people use Internet. Nowadays more than 60% of Internet Traffic comes from mobile devices like smart phone and tablets. A comScore report said, as of May of 2014, smart phones and tablets combined has now accounted for 60 % of all Internet traffic, up from 50 % a year ago, and 51 % of that traffic is driven by mobile apps. That tells us that the way people use Internet has changed significantly.
With more and more people using mobile Internet, and auction becoming a more and more widely accepted sales method for real estate, what will happen when mobile Internet bidding is used for real estate transactions? Undoubtedly mobile Internet bidding will boost more and more real estate transactions moving online, which will also result in more real estate transactions by auction sales method, and less transactions by conventional negotiated sales method. In the near future, we will also see the majority of real estate transaction goes online.

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real estate auction

Online Price Negotiation Sale Method for Real Estate

Online Price Negotiation Sale Method for Real Estate
By Robin Liu, June 2015.

There are two sale mechanisms that dominate real estate sales: Negotiated Sales Mechanism and Auction Sales Mechanism.
For auction sales mechanism, we all know that online bidding has been implemented into this sales mechanism. What is more, online bidding system also makes the real estate auction method grow substantially in recent years, emerging as an alternative real estate sales method.
For a long time, I have been wondering why online price negotiation has not been applied into negotiated sales mechanism. Offer Counter-offer formula was developed in 19th century, and is still going offline. We know that it is lots easier to apply online bidding into auction sales method, but it is more complicated for negotiated sale method, simply because online system has to properly handle the negotiation process between one seller and multiple buyers.
In fact, if the offer counter-offer formula is modified properly, the process of price negotiation between one seller and multiple buyers can also be done completely online as well.
Robin Liu, the founder of Bidwin.org (link: http://www.bidwin.org) which is the first online real estate auction marketplace (link: http://www.bidwin.org) in Canada, recently innovated an online price negotiation method which he named BidNego Sales Formula, and he is now working to implement it intoBidwin Real Estate Auction Platform (link: http://www.bidwin.org/community/page/Why-Real-Estate-Auction-Platform ) as an extra option of sales method. He has also filed a patent application and now the application is patent pending.

Here is the formula of BidNego Sales Method:
Online sale starts with an asking price at high end, and an minimum starting price at low end.
Buyer’s offer price can only go up from the starting price.
The seller’s counter price can only go down from the asking price.
Online process ends with success when seller’s counter price meets buyer’s offer price.
Sale process has no end deadline. Sale process keeps going till the property is sold or the listing is cancelled, withdrawn or expirs.
See the graph blow:

It is a transparent process: every offer price and counter price are visible to both seller and all buyers.
Every offer price is binding for 48 hours or outbid by a higher offer price, whichever comes first.
At any time seller can accept current highest offer price and ends the online process as long as the current highest offer price does not pass the 48 hour binding period.
At any time the buyer can accept the seller’s current counter price and ends the online process as long as the listing is active ( not expires, cancelled or withdrawn)
Every new offer price must be higher than the current highest offer price by a pre-set increment, even when the current highest offer price has passed the 48 hour binding period .
Seller’s counter price is continuously binding till the listing is cancelled, withdrawn or expired.
All buyers’ offer prices and seller’s counter prices are based on the same set of transaction terms. No contingencies or conditions precedent (No cooling period) are allowed.
Seller can withdraw and relist the listing after the current counter price stands for a certain period(for example 48 hours). This can be used by the seller to avoid current counter price being accepted by buyer.

What is the differences?
The BidNego Sales Method is a modified Negotiated Sales Mechanism.
If there is only one buyer in the whole sale process, the process is in fact exactly the same as the negotiated sale mechanism, that is why the auction sales method will fail in this case, but BidNego Sales Method will not.
When there are more than one buyer participating in the sale process, the process is in fact more like a modified auction process mixed with negotiations with seller.
The best embodiment of this sales method is by online process. In an online sale process, buyers and seller can submit offer price and counter price any time anywhere. The client computer devices can capture data from server computer and draw a graph like below:

Categories
real estate auction

Secrets Exposed: The Best 7 sources for finding real estate auction listings

Author: Robin Liu  

Dec 19, 2019

As a real estate agent, you probably know lots of sources for finding real estate listings, but very few real estate agents know the sources to find real estate auction listings, which make this business less competitive, and thus an excellent business opportunity. Knowing how to find and where to find properties that are suitable to be sold at auction is the key to making money as a real estate auctioneer, and also crucial to the success of a real estate auction business.

There are lots of sources available for finding real estate auction listings, but the 7 sources that I will EXPOSE below are absolutely the best and can produce enough auction listing to keep you busy for the lifetime of your career as a real estate auctioneer.

Source No.1: Kijiji

Kijiji is the equivalent website as Craigslist in the US. With Kijiji. The nice thing is, while you are viewing the ads, you can click reply and send an email message regarding your auction services directly to the email inbox of the person who posted the ad.

Before searching Kijiji, you should create several different email replies in Word format, so that, when replying to the ads, you can simply copy and paste the appropriate message into the body of the email depending on the type of ad that you are responding to.

For example, you should create several separate customized message for :
replying to For Sale By Owners
replying to real estate agents
replying to landlords

Source No. 2 : Newspapers

The real estate section of local newspaper is often loaded with potential auction listings, and all you need to do is to prospect for them.

As part of your weekly prospecting routine, you should search the real estate classified ADs on a daily basis. You may also find auction listings in other headings of newspaper, such as “Commercial Property” or “Investment Properties”.

You need to keep it a daily, at least a weekly habit to search for auction listings in your local newspaper, so that you are able to track ads that have been posted for several weeks, which would be a good indication that the property owner is a motivated seller and may be interested in an auction – an accelerated selling option.

When scan an ad with your eyes, look for signs and keywords that identify potential auction listings. The following signs and keywords should never be missed:
Motivated Seller,
Must Sell, Most Go,
Below market,
Transferred,
Estate Sale,
Pre-foreclosure, Foreclosure,
Sale due to illness, Sale due to Health,
Death Notice, Estate Sale
Owner financing, 100 percent Financing,
Lease Option,
No Money Down,
Unemployed, Lost Job
Divorce,
Price Reduced.

Source No. 3: Real Estate Agents and Brokers

For some properties on MLS, the traditional sale method will fail, but auction method will succeed. How every, being a real estate agents, but not a real estate auctioneers, they do need cooperation of real estate auctioneer to make a sale.
Most property information packet include special fields or remarks that indicate whether the property is listed as a short sale or a foreclosure.

To prospect for MLS listings that are suitable for auction, simply scan property listings and look for keywords such as “bank owned”, “corporate owned”, or REO, which indicate that the listing is a foreclosure. If you see “third party approval required”, that means the property is possibly a short sale listing.

Once you find the potential auction listings, the next step is to contact the listing agent and offer to work with him or her as a broker’s agent.

Some real estate agents may wrongly assume that working with a real estate auctioneer as a broker’s agent will grab their commission. The fact is that the listing agent keep the listing commission less the co-broke fee, which they would typically pay to a selling broker anyway.

Source No. 4: Banks and Lenders

Bank REOs and Foreclosures are excellent source of properties to auction, simply because the bank’s goal is to get rid of the property as soon as possible.

Most banks and lenders list their REO properties with local real estate agents. Auctioneers can solicit the real estate agents that handle the sale. but they can also call the banks or lenders directly for available foreclosures on hand.

Auctioneer should deal with the individual person who oversees the REO department of bank or lender. This is the person who has the power to approve any offers you make to list the property for sale by auction.

Source No. 5: Lawyers and Accountants

We all know that foreclosed properties are excellent source of properties for auction listings, but you may not know that most of foreclosures are due to bankruptcy, divorce, and death. Those property owners inevitably seek advice pertaining to these matters, thus often seek the advice of their lawyers.

Tax issues regarding a foreclosure, bankruptcy or other financial calamity can be very complex, and most property owners must turn to their accountants with expertise in tax for guidance.

Connection and networking with local lawyers and accountants who specialize in bankruptcy, divorce, or estate matters can bring you a constant flow of quality referrals of those potential motivated sellers.

To get to know lawyers and accountants with these specialties, just look in the yellow pages of your local telephone book, or do a Google search and you will find lots of lawyers and accountants that you can contact. Just mail or email them letters that introduces you and your auction services along with your business card.

Source No. 6: Properties In Pre-foreclosure

Ever wondering where can real estate auctioneers find free information about properties in pre-foreclosure? The answer is city hall office or RM office.

Although foreclosure laws very from province to province, properties that are headed for foreclosure will have notices of default or lis pendens recorded with the city hall’s office where the property is located. Searching through these public records is completely free.

The foreclosure law requires banks to publish a notice of all pending foreclosures. You can easily find these notices listed in the local news paper.

You should also look for public notices of obituaries and tax lien. Estate sales often include real estate that must be liquidated. Tax lien notices are given to properties that are delinquent on property taxes and are scheduled to be sold through a tax auction. You have every right to contact the owners and offer to auction their property before the property is foreclosure on.

Direct mail, email, phone calls, and personal visits are all proper ways to reach these property owners.

Source No. 7: Foreclosure information Websites

There are a couple of dominant foreclosure information websites that specialize in collecting and listing pre-foreclosure information. On these website, there is only executive summary of property information. To get contact information on these properties in pre-foreclosure, you have to be a register member and pay for it.

This is a paid service. Personally I have never tried their services, and you need to do your own due diligence to find out if their information is valuable to your auction business.