072: Buying Properties on eBay

February 3, 2017bmanasseroUncategorizedNo comments

SHOW NOTES FOR EPISODE 072 – BUYING PROPERTIES ON EBAY

Finding good below-market properties is not easy. Sometimes you need to see 100 properties before you find one that meets your criteria. In this episode, Bill looks at eBay as a possible resource for prospective properties and shares his personal experience in the eBay real estate marketplace.

Why in the world would I even have this as a topic? And even if I do, WHO IN THEIR RIGHT MIND WOULD BUY REAL ESTATE ON EBAY? And that’s precisely why I wanted to discuss this topic.

First off, I’m one of those crazy guys who has tried to purchase a property on eBay. And will share my experience later on with you on this podcast
Also, because many people don’t take it seriously, if there are legitimate properties listed, you just may find some good deals and have a pretty good chance of snagging them

Why eBay?

First off, as a new investor, you should always be looking for good sources of properties for bargains and you may not always have access to the prime off-market properties
I’m always trying to find properties at least 20% below market – which isn’t easy
So where does one find good off-market – below market properties?
- Most of the time, I relying on brokers and other contacts to offer me their private or off-market pocket listings
- But that may or may not be something that meets my criteria
- And getting a steady stream of prospective properties is necessary –especially if you consider the fact that your “diamond in the rough,” that may be one property out of 100 you see.
- So many people look for:
  - Foreclosures
  - REOs
  - Government auctions
  - Leins/trust deeds
  - The courthouse steps
  - Or go direct to sellers via direct mail, postcards, bandit signs, etc.
  - You have to dig
- So why not consider eBay?
  - Just to give you a little background, eBay opened real estate category 2000-2001. In just 18 months, it had more than 20,000 listings
  - And on average, each posting generates 1,000 viewings
  - Although there is no solid data on actual sales, many investors and businesses use eBay regulalrly to find deals and sell properties
  - Should you buy — or sell — a home on eBay? Or is it too risky? Before you decide to participate in an online auction familiarize yourself with the rules of the road.
  - One of the appeals is that it there is no real obligation
  - The format for eBay real-estate auctions is different from those used on the rest of eBay. For starters, a bid to buy or sell real estate on eBay isn’t legally binding. A bid on eBay for a property merely expresses your serious interest in the purchase and indicates that you want to proceed to final negotiations for the property. Neither the seller, nor the buyer, has a legal obligation to actually complete the real-estate transaction
  - Because of a wide variety of laws governing the intricacies and legalities in real estate transactions, the auction format isn’t really binding. Howveer, before getting involved in any real estate transactions on eBay, read the official eBay rules, so you know what you’re getting yourself into.
  - The eBay process does provide an “escape clause” to protect buyers who later learn that the property they’ve bid on doesn’t match the ads posted online.
  - Why would someone list on eBay?
    - There’s a myriad of reasons but a few common reasons are
    - Avoid agent commissions
    - Quick sale (often use a “quick claim” deed transaction)
    - Free advertising – A way to get your property in front of millions of prospective buyers
  - How does it work?
  - When you’re looking for a property it’s fairly easy, just like you were going to buy anything else on eBay
  - You can sort by:
    - State/Location
    - # of Bedrooms
    - # of Baths
    - Sales Type
      - Existing
      - Foreclosures
    - By who is selling:
      - Agent
      - Owner
      - Not Specified
    - Square Footage
    - Condition
    - Price
    - Format
      - Auction
      - Buy it now
    - Categories:
      - Residential
      - Land
      - Timeshares
      - Commercial
        
        Industrial
        
        Hotel/Motel
        
        Apartments
      - Other Real Estate
      - Manufactured Homes

My Experience with eBay Investing:

Found 8 units, 2 4-unit buildings, in Dayton, Ohio
(read ad)
Owed $21k in back taxes
Listed for $47K, made a bid at $37K
Brink buildings (I love brick) built in 1940 in great condition. Interiors were upgraded and looked good, too
Other similar buildings in the neighborhood sold between $89-125,000
Dayton was not on my radar but it caused me to research heavily:
- Did extensive research on the market, neighborhood, etc.
- Found good PM through BiggerPockets
- Found the top commercial broker in Dayton
Had the PM/broker visit the property, do a walk through, take lots of pictures
Found a local Dayton attorney
Submitted an LOI
Lady backed out at the last minute

Let’s take a look at eBay today (Tuesday, January 31^st, 2017)

(Bill did a walk through with listeners on listing on eBay)

Bill emphasizes that eBay may not be for every real estate investor but that is can be, in his opinion, a viable resource for prospective properties. Just, as with any potential property, if you do your due diligence properly, you should have nothing to risk.

Here are a few articles that might be of interest:

Well, that’s it for now!

Until our next podcast, keep moving forward and God bless!

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