Asteco to use online auction route for Dubai property

The firm believes it will offer a competitive advantage to its clients

Asteco Property Management, a local real estate consultancy, is reintroducing the concept online property auction in the UAE and believes it will offer a “competitive” advantage over traditional real estate sales and marketing tactics to its clients.

Except for Dubai Land Department’s public auction, which saw a number of foreclosed properties being sold this year, property auctions held previously by private companies have failed to gain traction in the UAE.

In 2008, a number of companies entered into the auction business. Though some did hold auctions for a few properties, none were ever sold. Following the lack of interest by local investors, some closed shop, while others never dared to venture out again. But none of the auctions were done online.

Asteco has signed a partnership with LFC International Real Estate Brokerage, international real estate auction-marketing company that recently put a corporate suite in Burj Khalifa, the tallest tower in the world, on auction.

“The real estate market in the UAE, particularly Dubai, continues to draw a significant amount of interest from institutional and private investors from overseas. Furnishing these financiers with the opportunity to invest in local property through a safe, secure and transparent online auction will undoubtedly make it more convenient and therefore even more popular,” said Elaine Jones, CEO, Asteco Property Management.

Typically the process for an owner to sell their property via the online auction begins with submitting an agreement, establishing the minimum bid and setting the bid deadline, which is usually 30 days after the property’s profile page is “live” on the auction website.

Interested buyers can then view property images and conduct due diligence directly from the website, as well as place their bids. Once the auction concludes and the reserve price has been met, the highest bidder is contacted, a solicitor is instructed to carry out all legalities, contracts are exchanged, funds released and the sale is completed.

Emirates 24/7 has reported before that Dubai Land Department charges a fee of Dh2,000 per auction with no restrictions on number of properties that can be listed. However, it is not clear whether online auction will require permission from the department.

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