Storage Auctions: Knowing How Much to Bid
Many people are drawn to the allure of storage auctions from watching TV shows like Storage Wars and Auction Hunters. These popular reality shows have placed the industry in the limelight for the entire world to see. As such, there's been an influx in the number of people participating in storage auctions. But many newcomers to the industry wrongfully assume that each and every storage unit is valuable, at which point they'll raise their bids in an effort to win the unit. If you want to achieve any notable level of success in this industry, you'll need to learn when to bid as well as how much to bid.
How Storage Auction Bidding Works
Storage auction bidding works in a similar nature as any other bidding process. The auctioneer will cut the lock on the abandoned unit (assuming it has one), allowing bidders to peek inside for a few minutes. This time is critical, as it allows everyone to determine their max bid. Next, the auctioneer will begin to the auction with a low bid, such as $20 or $50 -- varies depending on the visible contents of the unit. The auctioneer will then ask the crowd if they would like to bid higher, typically using an increment of $50 or $100. The person who bids the highest is the winning bidder, and thus takes home the contents of the unit.
When to Bid
So, how do you know when to bid on a storage unit? Well, you'll need to look inside the unit once the auctioneer cuts the lock to determine whether or not it's worth bidding on. If the unit contains nothing more than old boxes and trash, conventional wisdom should lead you to believe that it's not worth bidding on. However, if the unit contains box-sealed items, premium furniture, and other expensive stuff, you can rest assured knowing that it's a valuable unit.
How Much to Bid
Unfortunately, there's no magic formula to determine exactly how much to bid on a storage unit. With that said, however, there are ways to get a general idea of a unit's worth. One popular and effective tactic is to base your bids only on what you can see. If you see $500 worth of items inside the unit, for instance, you should bid no more than $500. Doing so will ensure that you can turn a profit on the unit; thereby, mitigating your risk.