Home » Real Estate Investing » Pre-auction bids – Another Lesson Learned

Pre-auction bids – Another Lesson Learned

Last week, I felt disappointed because I found out that all of the small condo units (22 sqm) in the upcoming UCPB auction were already sold out, even if the auction was still 3 weeks away. It turns out that Century Properties Management Inc. (CPMI), the one handling the auction for UCPB, had accepted pre-auction offers with 5% markup on the minimum bid price.

Sign Of The Times - ForeclosureImage by respres via Flickr

They numbers looked good

I was really looking forward to bidding on those properties as they appeared to be good deals based on the cost of Php14,000/sqm or about Php308,000 per 22sqm unit. At this price, the monthly amortization would be around Php3,800.

These units would have rental income ranging from Php8,000 to Php10,000, according to the account manager from CPMI. That translates to a positive cash flow of around Php2,200 to Php4,200 per month [assuming other factors like property management costs, maintenance, etc. amount to Php2,000 per month].

The passive income could actually be higher if a contract of lease w/ option to purchase (rent-to-own) scheme was put in place instead.

My only consolation

I was somewhat consoled when a CPMI agent told me that the units were sold to individuals/families who have been waiting for the past year for the units to be up for sale. Maybe they really deserved to have those properties.

Anyway, there’s more than enough properties out there for everyone.

Nevertheless, I have learned from this experience that I should stop procrastinating and also stop being too complacent.

I should have called the day the ad came out and asked if they were accepting pre-auction offers, even if it was not written in their ads.

Taking immediate action is the key to avoiding missed opportunities and this is one perfect example.

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About Jay Castillo
People encounter problems and make mistakes when buying foreclosed properties, and Jay wants to help people avoid those problems/ mistakes. Jay encountered a lot of those, which is why he started this blog in 2008 to serve as a guide where he shares lessons learned, and how to overcome challenges you may encounter when investing foreclosed properties in the Philippines … [Read more]
Avoid losing money, wasted time and effort caused by buying foreclosed properties that have too many problems, with our free 60-item Property Due Diligence Checklist. Grab your free copy now.

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21 thoughts on “Pre-auction bids – Another Lesson Learned”

  1. Hi! I am really interested to learn about real state investing, I wish u could guide me. I am new to this but I am willing to do what ever it takes learn. I am thankful that u have created this site, and that u are willing to share your knowledge and blessings. More Power!

  2. Pingback: How To Easily Calculate The Return-On-Investment (ROI) For Rental Properties
  3. Pingback: 31 Questions You Need To Ask When Inquiring About A Foreclosed Property
  4. Pingback: UCPB repossessed cars for sale
  5. Hi Jay,

    I’m new to your site. I was amazed that there is vast info like these and somebody is willing to share. My curiousity arises when my plan to transfer my place of residence near to my workplace arises. I was doing my “due diligence” in looking for a “home for life” as we are actually currently residing on my in-laws house since they are not using it anyway (Abroad). It was like an eye opener to me when I read your blogs and I remember what I have read also in R.K book (RDPD) few years back. I have encountered a foreclosed property which i think is enough for us (5 members) and call up the bank regarding the listing. I got your 31 Q’s and started my info gathering. I haven’t got any experience in bidding and I don’t know how it works, any hints for this. More power and success.

    • Hello Hornyspear, I’m really happy that you took action and are now in the info gathering stage! As for bidding, just make sure you have done all your due diligence like checking the Title, arrears(homeowners dues, utilities, etc), condition of the property, repair estimates, your maximum allowable offer, etc., before you bid. During the bid, don’t get carried away when you have competition and just lower your paddle when the bid price exceeds your ceiling.

  6. Hi Jay,

    Just wanted to say that your blog has really been very informative. 🙂 I also want to invest in real estate, and your blog has helped me in assessing the risks in such a venture. Thanks for sharing your experiences! 🙂


  7. Hi jltagle3jnt, the CGT will be based on zonal value or purchase price, whichever is higher. In your case, it’s the zonal value so the CGT based on it would be the correct amount to pay. Congratulations on your purchase and thanks for visiting!

  8. Hi Jay,

    Im new to this endeavor. I read almost all the Rich Dad Poor Dad books and books by Larry Gamboa and Tracy Trajano for the past month. that is how interested I am. however in my reading, these books never gave a good example of the RENT-TO-OWN CONTRACT? Would you be willing to share a template? would really appreciate it very much. thanks.

  9. Hi Jay, I won the public auction conducted by the city government of Taguig and after the 1 year redemption period had lapsed the City government issued a Final Deed of Conveyance. I went to BIR to apply for CAR but the CGT is based on the Zonal Value and not on the Bid Price. Should i pay for it? Pls advise.

  10. Hi Anonymous, may I ask what bank the property is from? Yes, banks may sometimes remove a property from their list of properties available for negotiated sale when they intend to sell it through a public auction but the minimum bid price often remains the same or is even lower.

  11. Hi Jay!
    Just today i called the bank regarding the foreclosed property I saw on their list, for im interested in it. Surprisingly, the bank said that its NOT for sale NOW. But they will include the said property for auction on April 25, 2009 (barey one month). The bank also said that they will post the auction on the newspaper before the auction date. And the price is double based on the stated price on the ad on the net. How is it ba talaga, i’ll buy na nga ayaw pa nila. How it goes ba?! kinda frustrating pero i will never give up. For now, please enlighten me.
    Thank you also because i got someone to ask re the matter.

  12. Hi Ferdz, exactly! Thanks for visiting my blog. For those who don’t understand tagalog, the saying “talo ng maagap ang masipag” translated in english is “Timeliness wins over being industrious”. Better translations are welcome. =)

  13. You’re welcome Dragoro. This would have made it closer for me to get out of the rat race. Oh well, there’s more than enough good deals out there, we just got to keep moving forward.


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