The real estate market is both hot and cold: the contradiction between the sky-high price and the low price of the foreclosure house coexists, the pie of the leaker or the trap?
In the midst of the turmoil of the real estate market, foreclosure houses have broken into the field of vision at surprisingly low prices, challenging our traditional perception of value?
I am twenty twenty, the factory listed by the People's Court of Xicheng District, Beijing, the market price is 130 million yuan, but the auction starts at 1 yuan, and the transaction price is only 18,000 yuan, and the unit price per square meter is less than two yuan?
Does this signal new opportunities in the market, or is there an unknown risk hidden?
When the low price of foreclosure houses becomes the norm, should we be brave enough to "pick up the leaks", or be cautious and wait and see?
In this seemingly lucrative auction, can we really pick up a bargain?
1. The "surprise" of the market: a legal auction house with a starting price of 1 yuan
In the real estate market, price is often the most sensitive nerve for human beings.
And when this nerve was gently plucked and the words "1 yuan starting point" appeared, it was undoubtedly a shock bomb to the market
No, the Beijing Xicheng District People's Court put out a set of market prices
Does this kind of "pie in the sky" thing really exist?
Or is it a humorous joke played by the market?
2. Less than two yuan per square meter
In the real estate market, price is undoubtedly a sensitive factor that touches people's hearts
And when there is a "1 yuan starting auction" auction house in the market, this undoubtedly brings a huge shock to the market.
The market price of the factory listed by the People's Court of Xicheng District, Beijing is as high as 130 million yuan, but it starts at 1 yuan.
This can't help but be reminiscent of the fairy tale "Open Sesame", but in reality it is staged"
The auction attracted a scene as enthusiastic as a star's concert
However, behind this, does the lower transaction price of foreclosure houses mean a "surprise" in the market, or is there a hidden "trap" that has not been detected?
According to the data, in the first half of 2024, the national foreclosure of residential buildings,
but
Availability
It shows that the scale and intensity of discounts for foreclosure houses are increasing
The low price of foreclosure may be related to a variety of factors.
This includes the status of the property, the relationship between market supply and demand, the transaction process and costs, etc
In some cases, the starting price of a foreclosure property may be set very low, such as $1, usually to attract more bidders
However, the actual price will be determined by the auction and may end up being much higher than the starting price, but it may still be lower than the normal market price
For example, a house in Zhengdong New District, the starting price
It is important to note that foreclosure transactions may involve complex title issues and additional tax expenses
Before participating in the auction, it is recommended to do a full production survey and understand the background of the house, transaction costs and other information to avoid potential risks
In addition, the purchase of foreclosure property also needs to carefully consider the clarity of the title, the condition of the property and the potential additional costs
Rationally assess the risk, and you may be able to find your own comfort in this special feast of home buyers
However, the increase in foreclosure also reflects some economic signals
It may signal increased downward pressure on the economy, rising loan defaults, and uncertainty about business operations and household income expectations
At the same time, however, the activity of the foreclosure market also shows the role of the market self-regulation mechanism, and non-performing assets can be reallocated through judicial auctions, injecting fresh blood into the market
In this market full of uncertainties, the opportunity for foreclosure houses to "pick up leaks" does exist.
But it is also necessary for buyers to keep their eyes open, fully understand market information, and use professional institutions to conduct risk assessment.
In order to move forward steadily in the tide of real estate investment
3. The "escort" of the policy: the legal basis for the auction without reserve price
According to the Provisions of the Supreme People's Court on Several Issues Concerning Online Judicial Auctions in People's Courts,
In other words, if you find anything that is 70 percent below the appraised price or the market price,
Regardless of whether it is a property or not, don't bother to bid on the event, and save yourself the trouble of violating the rules
However, there is now a situation where the foreclosure house is bursting
I really don't know if it is not a special case, such as the property involved in a criminal case, the court may adopt the method of auctioning without reserve price
It's like being in the sea of auctions, giving us a ship with no reserve price,
Whether you can pick up the treasure or not depends on your luck and wisdom
No reserve price auction, i.e. no minimum price is set during the auction process,
There are several main reasons for this phenomenon:
1. Increase exposure and engagement:
Some courts may set a lower starting price in order to attract more attention and participation.
For example, "$1 start", but this is usually to increase exposure, and does not mean that the final sale will be extremely low
All the right to parse belongs to the court haha
That's why you're still bidding
Still want to pick up the slack?
2. Innovation of auction rules:
For example, in the "Working Rules for Online Judicial Auction of Property Involved in Criminal Cases in Zhejiang Provincial Courts" issued by the Zhejiang Provincial High People's Court in June 2020,
It is stipulated that online auctions of assets involved in criminal cases shall implement bidding rules with a minimum auction of 1 yuan and the highest bidder
3. Marketing strategy:
Auctioneers may use unreserved auctions as a marketing tool,
In order to attract the attention of potential buyers and increase the competitiveness and intensity of the auction
It's obvious to say that, so do you still want to help with advertising?
4. Special circumstances in judicial practice:
In some special circumstances, such as the disposal of property involved in criminal cases,
The court may, in accordance with the relevant legal provisions and the specific circumstances of the case,
Property is disposed of by auction without reserve price
This rhythm is still waiting for the court to finally analyze and wait for the court to refute the rumors
Auction Supervision and Legal Provisions:
The Auction Law of the People's Republic of China and other relevant laws and regulations have clear provisions on auction activities.
When the court executes a judicial auction,
It is necessary to comply with these laws and regulations and accept the supervision and management of relevant departments
This is as if some courts may not comply.
also to be supervised,
Setting of the auction reserve price:
Under normal circumstances, a court auction will set a reserve price, and if the final bid does not reach this reserve price, the auction will not be closed
However, in some cases, there may be auctions without a reserve price, i.e. auctions without a reserve price
So how to look at whether there is a reserve price or not is still very critical, so don't care about the 70% market price?
4. The "pie" or "trap" of the auction house?
This auction of foreclosure houses makes people wonder: is this a "pie" or a "trap"?
Perhaps, it is more like a gamble, using 1 yuan of chips to win a jackpot of 130 million yuan
And the lucky one named Liu Tao may still be rubbing his eyes after the auction, unable to believe that this is true
1. In one case, Wang borrowed 1.5 million yuan from Li and used real estate as collateral.
Later, because Wang had not repaid his debts, Li asked to auction the property to repay the debts
There are two mortgages on the property with an appraised value of $900,000,
Less than the total amount of preferential claims and enforcement costs
There are two different views on whether or not to conduct a non-beneficial auction:
One considers the auction to be a useless auction,
the other is to judge whether it is useless according to the priority of Li's mortgage
2. Another point of discussion is whether the appraisal price in the online judicial auction can be used as the reserve price for the first auction
3. There are cases showing that when the court enforces a monetary claim dispute case, it determines the reserve price of a lot at 70% of the appraisal price to conduct an online judicial auction, and the person subject to enforcement raises an objection, claiming that the appraisal price should be used as the reserve price of a auction
4 、 . The provisions of the Supreme People's Court on the auction and sale of property in civil enforcement by the people's courts clearly state that the reserve price shall be determined for auction.
If there is no possibility of remaining the proceeds of the auction after the preferential claims and enforcement costs have been satisfied,
The court shall notify the applicant for enforcement, and if the applicant applies for the continuation of the auction, the court shall re-determine the reserve price
5. One yuan per suite in United States, Japan and Europe, and one square meter per dollar
In the United States, Japan and Europe, there are indeed cases where properties are sold at extremely low prices,
But these conditions are usually accompanied by some special conditions or reasons
In the United States, the city of Detroit has been affected by economic recession and population decline,
There is a property for sale with a price tag of "$1".
Most of these properties are old houses with wooden structures, which require high maintenance costs.
At the same time, buyers also have to pay a lot of property tax, and the property tax is calculated based on the government valuation.
Probably much higher than $1
In addition, foreign homebuyers are often unable to apply for loans in the United States, and even if they can, the interest rate is higher
Sicily, Italy, once launched the "1 euro home" program to attract people to settle in increasingly desolate towns
These properties often require extensive renovations, and buyers need to complete the renovations within the stipulated time frame or risk losing the purchase deposit
While it sounds like a good deal, the costs and effort involved can actually be enormous
Japan is facing a surge in the number of vacant houses, which are reported to have exceeded 9 million
Some houses were sold for "$0" due to the lack of managers and heirs
However, these homes may be subject to inheritance tax, property tax, and renovation and demolition costs, leading some to choose to sell for free to avoid additional costs
In addition, there have been reports of some buyers buying properties at very low prices, and then renovating them to increase the value of the property significantly
Although it is said that one yuan for a suite or one yuan for one square meter is nothing new abroad,
There is never anything new in the world,
However, in a land that believes that "house prices will never fall, they will always go up",
The final piece of advice is to sit back and wait for this to become the norm is the best option
The low price phenomenon in the foreclosure market has triggered us to think deeply about the real estate market
Globally, whether it's a $1 property in Detroit, United States, a €1 project in Sicily, Italy, or a $0 sale for a vacant house in Japan,
Do these cases truly reflect the reshaping of property values under economic pressure?
Above, what are your thoughts on this?
In the face of the temptation of low prices for foreclosure properties, how should we balance the opportunities and risks and make an informed choice?
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