Whether you're looking to buy a bargain, invest in distressed properties, or just curious about how auctions operate, this is the lowdown on how it all goes down.
What is a Property Auction?
A property auction is a public sale where real estate is sold to the highest bidder. In South Africa, auctions can be either voluntary (where the seller chooses to sell in this manner) or forced/sheriff auctions (typically due to repossession or unpaid municipal rates).
Types of Property Auctions in South Africa
1. Voluntary Auction
- Done by private sellers, developers, or banks.
- Organised through auctioneers like Broll, High Street Auctions, or Park Village.
2. Bank Repo Auction
- Properties repossessed by the bank due to defaulted bonds.
- Can offer great value but often come “voetstoots” (as is).
3. Sheriff of the Court Auction
- Result of a legal judgment.
- Managed by the Sheriff on behalf of the court (e.g., unpaid debts or municipal bills).
Step-by-Step: How Auctions Work
1. View the Auction Listings
You’ll find listings on:
- Auctioneer websites
- Property Platforms
- Legal Gazette (for sheriff auctions)
2. Property Viewing
- Attend open viewings (if available).
- For repossessed or sheriff properties, access may be limited—always a risk factor.
3. Do Your Due Diligence
- Check the Title Deed, zoning, levies, outstanding rates, or arrears.
- Know it’s “voetstoots” – you buy it as-is, with any defects or issues.
4. Register for the Auction
- Bring FICA documents: ID, proof of residence, and sometimes proof of funds.
- Pay a refundable registration fee or deposit (typically 5-10% of the reserve price).
5. Auction Day – Place Your Bids!
- Bidding happens live, online, or hybrid.
- The auctioneer controls the pace. Stay calm and know your budget.
6. Winning the Bid
- You’ll sign the Conditions of Sale immediately.
- Pay the deposit (usually 10% of bid price) and auctioneer’s commission (around 6% + VAT).
7. Transfer & Registration
- Balance is paid within 30–45 days.
- Once all fees are settled and documents processed, the property is registered in your name.
Important Notes
- No Cooling-Off Period: Unlike normal sales, auctions are final!
- You take on all arrears unless negotiated otherwise.
- Legal Advice is strongly recommended before bidding, especially for sheriff sales.