It is a public sale of property though open and competitive bidding. The property will be sold to the highest bidder.
Buyers come prepared to buy. "Lookers" are eliminated because most often bidders must qualify by depositing a bank draft or cashier’s order. Sellers get maximum exposure for their property. Many real estate agents now market auction property as auction properties are widely accepted. High holding costs are avoided. Through auctions, the seller is in control and knows that if the property is priced, his property will sell on a certain date from the auction listing. By selling quickly, the seller is able to avoid high holding costs and is also able to benefit from the use of the monies to reinvest in other opportunities elsewhere.
The buyer knows the seller is fully committed to sell. Auction agreements obligate the seller to transfer title to the highest bidder in an auction. The buyer knows he is getting the property at fair market price. The buyer feels comfortable with the purchase knowing that other would have been willing to pay for about the same amount for the property as his bid. The buyer sees many offerings in the same place at the same time. He is able to make market comparisons quickly and easily.
Intending purchaser who possess a Bank draft/Banker’s cheque be equal to 10% or 5% (depends on bank’s requirement) of the reserve price is qualified to become a bidder. Qualified bidder may delegate another to act as an agent or representative in his behalf. The delegate is required to submit a Letter of Authority and NRIC card photocopy of the intending purchaser.
The auction is usually held at the auctioneer's office, High Court or Land Office. In order to participate, intended bidder should first register with us 2-3 days before auction date and then request for relevant information about the auction property.
Foreigners, permanent residents (PR) and foreign companies can only buy non-landed properties (Master Title) priced at least RM2 million in Selangor & Johor Bahru and at least RM1 million in Kuala Lumpur.