How Do Real Estate Auctions Work?

In a real estate auction, properties are sold to the highest bidder, often because the owner is facing foreclosure or the property is part of an estate or liquidation. Auctions can be held in person or online, with bidding rules set in advance.

In my experience, auctions can present opportunities for buyers to acquire property below market value, but they also come with risks. Many auction properties are sold “as-is,” and due diligence before bidding is critical. Always verify title status, property condition, and any outstanding liens. For investors comfortable with higher risk and faster timelines, auctions can be a strategic play.