Auctions are a great way to score great deals—if you come prepared. Bidding against others for a big purchase such as land can be intimidating, so it helps to familiarize yourself with the ins and outs of the process.
Take note of these dos and don’ts when joining land auctions in Alberta.
What To Do
Do Your Research
Before anything else, arm yourself with the information you need, such as the land’s estimated market value, the current Alberta market state, and if there are any other similar properties up for bidding.
Look closely at the features listed and see if the property has everything you require. This would also be the perfect time to read any available documents for the auctioned land, such as the appraisal report or legal pack.
Do Prepare A Budget
Once you’ve signed up for the auction, it’s time to start budgeting. Take note of the property’s appraisal value and if there are any auction taxes and fees.
Land auctions in Alberta can be competitive, and it can be tempting to go beyond your allocated budget to seal the deal.
To avoid this, set a limit beforehand and stick with it throughout the process. You can even bring along your partner, kids, or an agent to help you be accountable—but make sure to provide them with clear instructions beforehand.
Do Bid At The Right Time
Timing is key in auctions, so it helps to be strategic about it.
You don’t want to bid a huge amount right at the start. Take note of the starting price and the available increments before placing your bid.
A good rule of thumb is to expect a 10% to 20% increase from the starting price, so don’t go overboard right away. At the same time, you also don’t want to wait too long to place a bid, or you might miss your chance.
Do View The Property Beforehand
Before bidding in a land auction (especially one online), consider checking out the property for yourself first.
Request a showing, then drive down to wherever it is in Alberta to get a better feel about the place. If a virtual tour is available, even better.
If you have any concerns, such as pests or build quality, this would be a great time to address them. Determine if there is a need for anything extra, such as repairs, a thorough cleanup, or renovation.
What NOT To Do
Don’t Forget To Register
The registration process is an important protocol to follow, whether the auction you are joining is online or on-site. Registering will secure your spot and make the process smoother as you bid from home or anywhere else.
If you’re concerned about security, you can rest easy knowing that most online auctions use credible, tried-and-tested, and secure platforms.
It would also help to register early. This will give you ample time to read the legal pack and auction guidelines and make other preparations.
Don’t Proceed Without Talking to Your Solicitor
To address any possible legal concerns, take time to consult your solicitor first.
They can investigate the property up for auction and see if anything will eventually affect its value or your ability to make it a place of business. They can determine if there are any restrictions such as access to utilities or right-of-way agreements.
Your solicitor can also help you look into local zoning laws and make sure you can use the land the way you intend. For example, in Rocky View County in Southern Alberta, you are not allowed to commence development processes without a permit; however, agricultural development can push through even without one—as long as the processes comply with applicable provisions of the bylaws.
With the help of your solicitor, you will also be made aware of your property rights in Alberta.
Don’t Overlook Refurbishment Costs
Before placing that bid, consider any renovation or refurbishment costs post-auction.
These expenses would depend on your plans: Are you going to build a farmhouse, ranch house, or livestock pen for your business? Are you planning to resell the property?
Each of these would have varying expenses, whether you need to make only minor cosmetic changes or invest more to achieve your goal.
Don’t Forget That The Process Goes By Quickly
Land auctions in Alberta are typically faster than traditional private treaty sales. Contracts are exchanged shortly afterwards, and the transaction is often completed approximately 20 days after the auction.
This is why it’s important to do your due diligence beforehand—research, budget, the works—to ensure that you have everything readily available right in time for the paperwork.
Be Prepared For Your Next Land Auction
Though land auctions in Alberta can seem intimidating, don’t let this stop you from placing your bid!
Auctions can be a great way to get a good deal on a property, but it is important to take the necessary preparations. Doing so will equip you with the knowledge you need to make an informed decision and ultimately get the best land at the right price.
Hansen Land Brokers hosts land auctions in Alberta and have successfully sold properties perfect for agriculture, farming, investment and development. We also sell and buy land and can help you find the right buyer who meets your standards.
Shoot us a message to learn more!
