How Do Storage Auctions Work?
Have you ever watched any episodes of the famous TV show Storage Wars and wished to experience the thrill of a storage auction? Anyone who’s ever been interested in such storage auctions has likely come across that show at least once. It tries to portray a realistic scenario of the process, but things might not be so simplistic in the real world. If you’re interested in bidding at the auction, you’ll have to get yourself registered first and then follow the rules as laid down by the auctioneer.
If you’re a newbie interested in the process but aren’t sure of how it goes about, you’ve landed just at the right spot. Here’s a quick guide on how storage auctions work so you know what to expect. Keep reading further to also know of a few tips that can help you bid better and probably even help you win at the auction.
When Does A Storage Unit Become Available?
Most storage units don’t just randomly go up for auction. When tenants fall back on their payments or abandon the storage unit, storage companies organize auctions to make up for the lost rental fees.
A storage unit can be put up for auction somewhere between 30 and 90 days after the tenant fails to pay the rent. The laws might vary from state to state but this is how a storage unit becomes available for auction in general. Auctions can be a costly and time-consuming process, so they aren’t usually the first preference of storage facilities unless absolutely necessary.
Once the storage facility decides to host an auction, it will advertise the auction through newspapers and online resources. Over the past few years, more and more facilities have started online auctions, so you can keep checking those resources to know about the available storage units.
Who Can Participate In A Storage Auction?
Anyone who is at least 18 years old and has a valid legal identification (like a passport or a driving license) is eligible to take part in a storage auction. You’ll have to get yourself registered beforehand if you wish to participate in the auction. It’s best to check with the storage facility whether they’d prefer online registration or in person. We recommend that you first attend a few storage auctions as a spectator so you can get better acquainted with the entire bidding process.
See also: Best Self-Storage Companies
How Do Storage Auctions Work?
The Bidding Process
Before the bidding process starts, the unit in question would be briefly opened for the bidders to have a look. The unit lock will be opened in front of the participants so that everyone can have a clear look inside. Bidders aren’t allowed to touch anything inside the unit or go through any boxes at this moment.
After all bidders have examined the unit, the doors are closed and then the bidding process begins with the auctioneer setting a minimum bid. The bidders can now compete against each other, trying to set the highest bidding amount.
If you’re attending an online auction, most websites will show you a picture of the storage unit and probably also give you a short description of the kind of contents inside. Know that you’ll be bidding on everything in the unit and not on individual items. Furniture, clothing, electronics, and general household goods are some of the most commonly found items in a storage unit. At times, you might also find collectibles, antiques, and jewelry, hidden as a surprise inside the storage unit.
After Completing The Auction
The auction for a unit is complete when there are no more offers and the person with the highest bid wins. The winner pays the amount immediately after the auction and will be required to clear the contents of the unit at the earliest. Some states may require you to pay sales tax if you win a storage auction and some companies might even ask you for a cleaning deposit which is returned after you clear the contents of the unit.
Tips For Success At A Storage Auction
- We’ve mentioned this earlier but carefully observing a few auctions before you actually start bidding in one is always going to be helpful. In addition to that, you can also consider learning the process from someone who has experience or who has done so previously. Try getting in touch with people who regularly attend such storage auctions and are willing to share some of their bidding tips and secrets with you.
- While the bidding process can seem enticing and keep you going on, it’s important that you set a budget and stick by it. Plan your budget before you enter the auction and set realistic expectations of the same. Even though storage units are like a quick source for easy money, it’s not wise to always play with your luck in the hope of earning huge profits. There could be times when you might even lose some money, you need to be prepared for all outcomes.
- Along with your budget, you should also have an idea of what you’re looking for. If there are multiple units for auction, this will help you understand what kind of unit you should bid on. Of course, you don’t know about the contents of the storage unit until the lock is broken, but at least after the unit is opened, you’ll get some idea if it interests you or not.
- A majority of all storage unit companies will require you to make payment as soon as you win an auction. While cash is the most preferred payment option, you can check with the auctioneer regarding the payment methods they accept.
- Auctions could go on for hours and be tiresome, so it’s best to wear comfortable clothes and shoes that suit the weather. It’s always better to reach the location at least 10-15 minutes prior to the auction so you can clarify the rules and doubts, if you have any.
- Make sure to go through every item in the storage unit when you win it at the auction. You may never know what valuables could be found mixed with other items. From the jeans pockets to the kitchen utensils, make sure you scrape the bottom of the barrel so that nothing goes unnoticed. Don’t forget to carry a pair of gloves because the storage unit that has been kept closed for long isn’t exactly going to be in a spick and span condition.
- Storage unit companies typically require you to haul away the contents of your winning unit immediately after the auction. If there are multiple units for auction then they might let you put a temporary lock on your unit. So if you intend to bid at the auction, make sure you carry a lock and make arrangements for a truck to haul away the contents of the storage unit.
Bidding at storage auctions is a different experience altogether. It can be tricky for newcomers to know how and what to bid on. But now that you’ve got some idea of how storage auctions work, you’ll be better prepared. You can look for storage auctions online or take the time to find one in your area. Get there a little early, know what you’re looking for, understand the rules, and most importantly, be prepared with some cash for if you win at the auction. Just make sure you don’t surpass your budget when involved in the bidding process because that might end up turning the tables against you!
Are Storage Auctions Worth It?
Whether a storage auction is worth it for you or not will majorly depend on how well you understand the drill behind it. Many times storage unit auctions are like a gamble because you aren’t entirely sure of the contents inside. If you’re lucky, you might make a huge profit, and if it isn’t your day, you might end up with no profit and maybe some loss too. But once you get an idea of how storage auctions work, it could be a fun and entertaining experience.
Can I Bid On My Own Storage Unit?
Yes, as per law in many states, storage auctions are supposed to be public sales. So tenants are allowed to bid on their own storage unit. However, the auctioneer may refuse to let the tenant be a part of the bidding process if the tenant is threatening in any way or poses harm to the functioning of the auction.
How Do You Win A Storage Auction?
The highest bidder who clears their payment first wins the storage auction. If you’re willing to and have the means, you can bid for the unit as per your preference. If no one exceeds your bid then you’ll win the storage unit. However, it’s important that you set realistic expectations of your budget as well as the things that you’re looking for. Understand the rules and working of the storage auction and try attending a few auctions as a non-bidder to get more first-hand experience.