Turning a profit by buying and reselling items acquired through storage auctions isn’t always an easy task. Sure, reality TV shows like Storage Wars makes it look simple enough, but you’ll quickly learn that it’s anything but. The good news is that you can successfully earn a living from storage auctions, but you’ll first need to learn the ropes of bidding. So today we’re going to reveal some essential rules to follow when bidding on storage auctions.
Decide Your Max Bid Before Bidding
It’s a good idea to decide your max bid before actually bidding. In other words, what’s the maximum amount that you are willing to pay for the unit? If the bids go over this amount, you should refrain from bidding. Newcomers have a tendency to “wing it” when it comes to bidding, which often results in a net loss. To increase your chances of success, decide your max bid on a unit before the auctioneer allows bids.
Don’t Bid More than What You Can Afford
Sounds simple enough, right? Well, you would be surprised to learn just how many people bid higher than what they can afford. When this occurs, the auctioneer must give the unit to the next highest bidder. Be aware of your financial situation and how much money you have when bidding.
Avoid Bidding Wars
As with most types of auctions, there’s always the possibility of a bidding war occurring at a storage auction. A bidding war occurs when two or more bidders continue to raise their bids in hopes of knocking out the competition. Instead of basing their bids on item valuations and other meaningful metrics, they will simply jack up their bids to spite the competition. Nine out of ten times, however, the “winning” bidder is forced to pay more for the unit than what it’s worth. To prevent this from happening to you, avoid bidding wars and base your bid prices on actual valuations and metrics.
Bid on What You Can See
One of the easiest and most effective bidding strategies for storage auctions is to bade your bids only on what you can see, not what you hope is inside the unit. Normally, the auctioneer will cut the storage unit’s lock, allowing all bidders to look inside. You should use this time wisely to scan the contents of the unit, calculating the total depreciated fair-market value. It’s unlikely that you’ll be able to see every item tucked inside the unit — and that’s okay. By basing your bids on what you can see, you’ll have a much greater chance of turning a profit on the unit.