How Self Storage Auctions Work

Self storage auctions are increasingly common in these times of economic recession. Their existence depends on renters falling too far behind on their payments and breaching the terms of their contract. Once this happens, the self storage company has the legal right to sell the contents of the lot at an auction.

Contrary to popular opinion, self storage companies usually try exceedingly hard to avoid the self storage auction which they deem to be a last resort. They will contact the owner and hold off for as long as is prudent. However, they will eventually need to free the lot and it makes no economic sense to allow a lot to remain tied up with no rent being paid. Their reluctance to hold the auction is demonstrated by the fact that they allow the owner of the property to show up and pay the rent on the day of the auction. There are three types of self storage auction:

    Sealed bid
    Live auction
    Blind auction

Sealed Bid
There is an element of mystery about sealed bid self storage auctions. You turn up and are allowed to see inside the lot. However, you are not allowed enter the lot and look around so it’s difficult to see exactly how much the property is worth. This could prove problematic because all bidders are then required to enter the amount they wish to pay in a sealed envelope. If you have the highest bid, the contents are yours. Bear in mind that the second highest bid wins if the winning bidder fails to pay within 48 hours.

Live Auction
This is by far the best type of self storage auction to attend but these are not as common as sealed bid auctions. Again, you can view the contents from outside the lot but this time, the bids are out in the open. A representative of the self storage company will act as auctioneer and allow the bids to be heard. Outbid the rest to claim your goods. Again, payment within 48 hours is mandatory.

Blind Auction
These are not the most popular form of self storage auction but they do happen. When you attend a blind auction, you have no idea what is inside the lot before you bid. There could be worthless rubbish in there or a hidden treasure trove. You bid blindly and the highest bidder is the only one who is allowed see the contents. This is a risky process and is not something that should be attempted by those with an aversion to risk.

With the economic outlook far from positive and so many self storage units being used in the United States, it’s likely that there will be no let up in the vast number of self storage auctions held in America over the next few years. If you’re attending a self storage auction, have a set budget in mind and do not deviate from it. You should also remember that the winning bidder is expected to empty the contents of the lot and clean it within a certain time limit imposed by the self storage company. You receive no help so have the requisite cleaning and moving equipment on standby if you’re bidding.