High-Tech Real Estate Transactions are Personal for Auction.com Chief Technology Officer Amit Aggarwal
Amit Aggarwal joined Auction.com as its chief technology officer in late 2017, but the experienced senior information technology (IT) leader had his eye on the needs of the national housing market for more than a decade before the hire. As early as 2005, Aggarwal was watching the residential real estate industry, considering the early signs of what he refers to as “cracks” in the then-booming housing ecosystem and working on a solution. By the time the market melted down in 2007, Aggarwal had been instrumental in the design and implementation of the workflow processes and platforms that served as the underpinning for the foreclosure crisis, including working closely with Fannie Mae and several of the country’s biggest banks and mortgage lenders.
“I started my career providing the software for banks and lenders to manage foreclosures,” said Aggarwal. “My theory is when you provide platforms to banks, sellers, and buyers that enable them to efficiently sell foreclosed assets – or any assets for that matter – then you contribute [to meeting] the needs of the community and to stabilizing the market. The earlier you can do that, the better.”
He recalled the realization that “the industry was going to shift” in early 2005 and the huge import of developing software to help lenders navigate that shift by, in many cases, selling off huge portfolios of distressed assets quickly. “We went to work and had a platform ready for all the banks and lenders to manage their foreclosure assets when the housing crisis came. That platform was the software used for the majority of those transactions in 2008 and 2009,” he said.
Aggarwal took his passion for purifying and refining technology, processes, and real estate transactions with him when he joined Auction.com. “The platform here is already a great one for auctions,” he observed, “but we’re not stopping with that. Every day, my goal is for my team and myself to continue to innovate. How can I push the boundaries and create a better experience for buyers? What can I change to make my mobile platform more accessible? How can we expand our content to provide better insight and education to every individual involved in the auction process and improve their interactions with each other, not just with us?”
Keeping True, Real Data at the Core
Like most real estate investors, Aggarwal walks a fine line as he strives to bring the most information and access to all parties involved in real estate auctions. “We’re in the business of providing access to understanding,” he said. “We are constantly saying to ourselves, ‘How can we offer the best experience to the buyer and the seller?’”
The answer to this question, Aggarwal believes, lies in providing the most information at the highest level of verification possible. “If you want to bid on assets with comfort, you need to be confident in the technology that handles that auction process and with the people behind that technology,” he explained.
Aggarwal’s ongoing mission revolves around creating better and better systems to assist buyers (often investors) and educate sellers in the processes associated with a home sale at auction, including due diligence, pricing, and setting expectation. He accomplishes that, in part, by way of accessible, high-volume data.
“We collect that data in multiple ways,” Aggarwal said. Auction.com’s systems deploy multiple sources of data, including assessor data, multiple listing source (MLS) data, public record, and real estate inspectors’ reports to assemble a “property detail page,” or PDP, that offers users access to a comprehensive view of the property up for auction.
“We have copies of the title, property inspections, and other information that you could pull up on your own if you had a team of people working for you or were doing this on your own, on a small scale, full-time,” he said. “With the PDPs, however, new buyers are empowered to get all that data at a central location from a central platform.”
That platform, Auction.com, is naturally well-served by its own goal of creating a larger population of active buyers, but so is the real estate investing community. According to a 2017 Harris/RealtyShares survey, 70 percent of Americans believe that investing in real estate is more difficult than investing in other asset classes and two-thirds believe the process is “just too hard.” The result: Only about three in 20 Americans are actively or passively investing in real estate despite three in four believing real estate investing is a good way to make money.
If Aggarwal’s team at Auction.com can help make the real estate investing sector less intimidating for the many Americans who believe real estate could hold financial answers for their families but, simultaneously, believe the sector is out of their reach, Aggarwal believes this would be the most important thing he could accomplish at the company.
“To that end, we’re continuously investing in new technology, taking that pure real estate transaction, the auction, and making it more mature and advanced, adding in an education factor for new and existing users looking to learn more and more about our space and their markets. The only way for us to thrive and for our users to thrive is making the platform one that provides the education necessary to achieve an easy, successful, replicable transaction,” he said.
The Evolution of the Third-Party Sale
While Auction.com has long been described as “the eBay of real estate” by industry leaders (Aggarwal noted wryly the description is “somewhat limited” in comparison to the scope of the company’s actual services and offerings), the company holds a firm presence at offline auctions as well as online events. However, recent evolution of the auction process in Ohio could ensconce the company even more firmly in the digital auction space.
In late May 2016, the Ohio legislature passed new provisions to its foreclosure laws to permit expedited foreclosures and sales on vacant and abandoned residential properties. At the same time, the state altered its policy on remote bidding and online auctions to allow all counties in Ohio to make their foreclosure auctions accessible online.
“Our team works with local private selling officers (PSOs) who have permission through sheriffs and judges to use Auction.com for those online auctions. We were able to essentially digitize the assets for sale and make them available to users all around the world,” said Aggarwal proudly. “You do not have to have a person sitting in each of the 88 counties in Ohio holding an auction in order to bid on the properties for sale in those auctions anymore. You can be anywhere in the country or the world, place a bid, and win the auction,” he added, emphasizing, as always, “That helps sell the assets sooner and stabilize the market faster.”
In fact, the first sale Auction.com transacted in Ohio was won by an investor out of the country at the time of auction. “As long as an investor has access to internet and is able to pay, then that person is ready to bid,” said George Lane, Auction.com’s vice president of legal and business affairs. “If you can buy legally at auction in the United States, then you can buy legally at an online auction from anywhere in the world,” he said. Lane and Aggarwal are both hopeful that Ohio’s ongoing success with online auctions will spur other states toward digitizing their auction processes.
“The overall limitation of the process of requiring people to come and be physically present in the state, physically stand in front of the court house and wait there, is limiting to the entire process,” said Lane.
“The flexibility that comes to buyers and sellers with online auctions enables communities to stabilize,” added Aggarwal. “This stabilization means these assets are turned back into homes and are not causing blight for an extended period of time. It’s in everyone’s best interest to stabilize these assets, and it’s my mission to bring all buyers, including investors, the stabilizing factors in this scenario, together with those auction properties.”
5 “Insider” Tips for Investors Using Auction.com
“Real estate investing should not be difficult, and it should not be scary,” insists Amit Aggarwal. While his contribution to making the bidding aspect of the process easy lies mainly on the IT side of the process, he had five suggestions for real estate investors using Auction.com’s platform for buying real estate.
1. Know what you’re buying
“Virtually any type of property can be sold at auction, so be sure to conduct your due diligence on a property,” he said.
2. Prepare for success in advance
“Anyone can attend an auction in person or online, but if you win the bid you will need to be prepared to make the purchase.” Aggarwal noted that Auction.com hosts an onsite presence for assisting with day-of needs and questions, although the scope of information available varies depending on state and county regulations. Most auctions require payment the same day the buyer wins the bid, although some states permit the buyer to make a deposit and then pay the following day.
3. Look for liens
“You must research all the debt on a property before you bid!” Aggarwal emphasized. “When you buy the property, you will almost certainly become responsible for these debts, and they can eat into your profits or even eliminate them entirely.”
4. Remember you are buying “as-is”
Although Auction.com makes it possible to bid on properties from anywhere in the world, you are still committing to buy the property in as-is condition if you win the bid. This means you must pay regardless of the condition of the property. Enlist the help of a local agent or contact to help you confirm the property is standing and appears to be in the condition stated in the online description but remember you cannot disturb any residents.
5. Reconfirm everything the day of auction.
Remember lots of properties never make it to the auction block because the borrower manages to postpone the auction, pay off the debt, or modify their loan. Sometimes, lenders or owners simply fail to get their paperwork in on time. “Check on your target properties before the auction starts and remember that Auction.com’s mobile app can keep you abreast of these changes,” said Aggarwal.