Online auction develops unique technology to make buying and selling property for pennies commercially viable
Humraz reinvents property auctions
Humraz will sell properties for a fraction of their value. For example, a £300k house is guaranteed to sell for less than £15k, although the final sale price is likely to be significantly less than that.
Humraz covers the costs of its lots by selling seats to the auction. Seat prices depend on the value of an auction lot. For a £300k property, for example, the seat prices range from £30-£90.
The number of seats sold in each auction is capped, bidders can only buy one seat and every bidder can place up to the same number of bids. It is a totally level playing field.
The innovative new auction console provides live information to each bidder about the status of their bids and the relative direction of successful bidding. Success is therefore determined by the bidder's skill, not guesswork.
Humraz set the seat price based on the level of interest the site's users express in each lot. The site displays each lot as 'preview' to allow users to vote for a price they would be happy to pay for a seat. Users who express an interest in this way can secure a discount on the seat price if the lot is auctioned.
The auction lots currently available to preview online include a four-bed detached new build house in Staffordshire, a three-bed semi in Northern Ireland and a 100 gram bar of gold bullion.
Humraz take advance seat bookings to circumvent the problem of having a reserve value. Users are able to pre-book seats at greatly reduced prices and are not charged until the auction start date is confirmed. Auctions are scheduled as soon as enough bookings are made to eliminate the need for a reserve.
This system is far-removed from Humraz's original model which ran last year. With the previous format bidders would pay per bid and were provided with bid status information to help them apply skill. However, the site's founders felt this system was flawed.
'We wanted to find a system to help people in this country get on the property ladder and lowest unique bids were an obvious route for this,' says Asmat Monaghan, Humraz's founder. 'However, under the previous system the deeper your pockets the greater chance you had of success. This was antithetical to our original purpose which is why we have invested heavily in developing new technology to ensure all our auctions run on a totally level playing field.'
To help Humraz members get accustomed to the new auction model, an online simulation is available and regular live practice auctions will be held. Humraz are also offering free seats in an auction for a Knightsbridge department store gift voucher.
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