Not yet as common in India as it is in developed countries, online property auctions are picking up here. A few property portals have taken up online auctions of distressed properties under the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act.
Advertisements are published in one English and one regional daily paper about 30 days before the date of the auction. Interested parties then need to present their bids in sealed envelopes to the auctioneer/authority along with a certain percentage of reserve price as earnest money deposit, which is refundable if one withdraws from the process or does not win the bid. The auctioneer issues a separate bid form to generate bidders’ login address and password for online auction.
Day of auction
The bidding is held live in online auction as well but on a portal. On the given date, at a pre-specified time bidders can log in to the website, can view the bids placed by others and, accordingly, revise their own.
Internet penetration in smaller areas remains a challenge. Second, analysts say there is no way the auctioneer can stop property sharks from entering the bidding process as they may form a bidding group and not let retail investors enter the pool.
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