Knowledge Base
Sheriff Auctions offer the best way to secure a discount when buying a property. Find out how they work and get tips and tricks from our FAQ and articles below.
About Sheriff Auctions
Creating Wealth with Sheriff Auctions
Unique properties can sell for biggest discounts. Find out why
Unique properties are a fantastic opportunity to buy at a discount. Heres why:
- They are harder to value: Unique properties have no comparable sales and features that are not often disclosed. Buyers who haven't done enough research will bid conservatively.
- Bonus Features: Conducting thorough research can reveal unique aspects and improvements not widely known. Look for features like home offices, cottages, pools, zoning advantages and undisclosed renovations
- Fewer bidders: With fewer buyers interested in these unique properties, your chances of securing a great deal increase significantly.
If you are interested a property that needs more research than average, start early to get as much information as possible. These can be golden opportunities.
Sheriff Auctions are the ultimate source of bargin property. Here's why
There are a number of reasons why properties on Sheriff Auction can sell for up to 50% off their market value
- Poorly Advertised: These auctions are only required to be advertised in the government gazette. This limits public awareness and reduces competition
- Lack of Information: Detailed information is usually unavailable. There are no pictures provided by the sheriff and there is no official way to view the property.
- Voetstoots Sales: Properties are sold "as is," with no guarantees, which can further reduce the bidding competition.
- Speed: Notice of the auction is usually just 10 - 14 days. Potential buyers need to be ready at short notice.
These factors combine to create opportunities for substantial discounts, making sheriff auctions a potential goldmine for informed and prepared buyers.
Read some success stories of big profits from sheriff auctions. Here are three real life examples
Sheriff auctions can offer incredible investment opportunities if you do your homework.
Here are some real-life examples:
- Luxury apartment with a private pool - R1.2m Profit A buyer acquired an apartment in Morningside for R2.2m, which unknown to others at the auction, had a large garden and private pool. He sold it three months later for R3.4m, earning R1.2m without any renovations.
- A residential plot - R2m Profit A buyer researched a vacant plot on auction, discovering it had planning permission for a sectional title complex. It was bought for under R1m and sold a few months later for R3m, Instantly making a R2m profit due to this exclusive knowledge.
- Modern cluster in Security Estate - R400,000k profit When researching a property going on auction, a bidder found that it was also listed through an traditional estate agent. The agent showed them the property and it was in exceptional condition. The agent also provided an accurate valuation as they had first hand experience of marketing the property. The property was then purchased at the auction for R1.7m and was sold a few months later for R400K profit.
Acquiring the right information is key to acquiring a big discount. All the buyers in the examples above knew something about the property
that other bidder were not aware of. This is the reason behind these huge discounts.
Start your research early to uncover the hidden gems that can lead to substantial profits.
How do I set my bid at a sheriff auction? Find out here
As a home buyer or investor looking for a discount to market value, you need to take the following into account when setting a bid level.
- Determine the market value: Using information such as the last sold price, nearby sales and speaking to local estate agents, determine the market value of the property.
- Decide what discount you want to get: Simply reduce the full market value by the percentage discount you are looking to achieve.
- Subtract outstanding rates and taxes: These will need to be paid for seperately and you must reduce your bid price accordingly. The sheriff will announce them at the auciton but if you prefer to get them in advance simply call the transferring attorneys before the auction. Their contact details are in the Gazette entry.
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Subtract the Sheriff Commission:
This is a between a minimum of R3,000 and maximum R40,000 (excluding Vat)
- 6% on the first R100,000
- 3.5% on R100,001 to R400,000
- 1.5% on the balance
Remember that transfer fees including transfer duty (or VAT) along with transfering attorney fee's will apply. Interest will also be accrued from the date of the auction.
