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Thursday July 30 2009
A four-bedroom apartment in The Green Community in Dubai could be
snapped up for as little as US$50 (Dh183) if sold successfully through
an online auction.
Steve and Arti Halligan, who plan to return
to the UK after 18 years in Dubai, have struggled to sell their home
since the start of the downturn so they have put it under the hammer on
Humraz.com, a website set up in the UK that is offering a revolutionary
way to sell property.
Each bidder pays between $50 and $100 for a “seat” to take part, depending at what stage of the process they register.
When
enough bidders have registered to cover the property’s value, transfer
fee, commission for the website and a charitable donation, the auction
begins.
But the Halligans need to attract 10,000 bidders before this can happen. Bids can range between Dh6 and Dh151,000.
Unlike
a traditional auction, the home will be won by the person who bids the
lowest, not the highest, with the catch being they have to choose a
figure that has not been chosen by anyone else.
A number of struggling sellers in the UK have used the site but this is the first home in the UAE to be auctioned on it.
Each
bidder has 100 chances to make the lowest unique bid but regardless of
the price the winner chooses, the cost of the seat is all they pay.
“The bid price just determines who wins … you get it for the price you paid for the seat,” Mr Halligan said.
The
Halligans hope to sell the property for what it was worth at its peak
in the middle of last year, which was as much as Dh3.8 million.
Property prices across the emirate have since fallen by as much as 40 per cent, with further declines predicted.
“We
don’t think we’ll get anywhere near the kind of levels we want by
selling it through the traditional method … plus I think this is an
interesting project,” Mr Halligan said.
“I’m a cautious person so I spent about six months thinking about it, but feel very comfortable with it.”
If
the property fails to attract enough bidders, then it is taken off the
website after about six months, with no cost to the seller or bidders.
Bidders pay for their seats only once the auction begins.
Because of the element of skill involved, the UK’s Gambling
Commission has ruled the auction as a competition and not a lottery,
therefore negating the need for a special licence.
For
properties sold through the site in the UAE, the buyer and seller must
follow local property transfer regulations. Three traditional auctions
have taken place in Dubai over recent months, with each failing to make
a sale.
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