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Published on 10/5/2017 11:58:42 AM
Property bidding: The new kid on the block
In the wake of a slowdown in the market and the huge inventory pile-up, developers are looking for innovative ways to sell their units. One such way is through the online bidding process. A concept that is hugely popular in the West, it is fast cathing the fancy of developers and end-users alike in India. Developers reach out to buyers, offering the lowest reserve price over which the registered buyers can place their bid.

What is bidding?

Oxford Dictionary defines bidding as “the act of offering to do something or to provide something for a particular price”. There are two types of bidding. The first is the one which is of the attached properties which are in the possession of banks. The other is when a property is sold by a developer in his new residential project. While a majority of the times, the property auctioned by a bank is usually a resale property in a well-developed neighbourhood, the property being put on the block by a builder is a new property which may or may not be in a well-developed area.

The interested buyer must be mindful of the fact that these properties are usually sold on ‘as-is-where-is’ or “as-is-what-is” basis. It could be that the property on offer is not in a good condition and you have to spend on repairs. If it’s a resale property which is being bought through a bank, check for any outstanding dues such as property tax and electricity bill.

Bidding online

Each unit is usually allocated a reserve price by the developer, which is the lowest primary market rate. Bidders have to pay a participation fee. Once the potential bidder comes to the platform and registers for the process and the registration is approved, the KYC documents and a post-dated cheque for the mentioned amount has to be submitted. On the successful payment of the participation fee online which acts as a bidding fee, KYC documents and PDC, he or she now waits for the bidding process to begin.

What you should do?

It is a buyer’s duty to do the due diligence.

The bidder should ascertain the average price of similar property in the locality, so that he can take informed decisions. Check out the property by visiting the website or the actual site.

Check out which unit you want to bid for. Some of the things you should consider are Vastu compliance if you are a believer, orientation of the flat as that impacts the sun and wind coming into the unit, the view outside as that is something you have to live with and the number of units per floor which determines the wait time at the lift.