Those who have cash flow are evaluating their participation in a public electronic bidding competition, as the auctions, after a pause due to the pandemic crisis, are in full restart. However, divestitures may have some risks.

“Online auctions can hide pitfalls. The prospective buyer does not have the opportunity to visit the property, which, in many cases, is in poor or very poor condition, requiring significant expenses for renovation work “, as stated in by the CEO of Athanasiou Real Estate Services, Michalis Athanassiou.

In fact, the under bid houses very often show significant urban planning violations, which require their legalization, a process that is quite costly.

“We must not forget that with the expiration of the inclusion deadline on September 30, a significant number of properties will not be able to be legalized,” said Mr. Athanassiou.

There are also cases where certain urban planning violations are not settled, such as the encroachment of a common space with the result that the owner does not have the possibility to transfer the problematic property.

The tenancy relationship continues to apply to a property that someone buys through a forced auction. On the contrary, in commercial real estate for certain categories of traders this does not apply.

Thus, in order to avoid traps, it is always necessary to carry out legal control because the auction carries many risks, such as the opposition process, which can last up to 10 years.

It is not uncommon for the successful bidders to lose the letter of guarantee because due to inexperience or time pressure, during the process they incorrectly add a zero above (eg 900,000 euros vs. 90 thousand).

“Those interested should only buy opportunities and know the market value of the property”, concludes Mr. Athanassiou.

Source: Capital