The General Services Administration (GSA) sells surplus real estate owned by the government. This property is acquired from a wide variety of sources. Some comes from the Internal Revenue Service (IRS), which acquires property from people who don’t pay their federal income taxes. Other properties come from other agencies of the federal government. The Property Disposal Office of the GSA has the responsibility of selling property to the highest bidder. Sometimes you can get extraordinary bargains here.

The GSA usually sells its properties using two methods: sealed bid and public auction.

In the sealed bid method, bidders are directed to mail their bids with a designated minimum deposit to a specified regional office. You must get the bid in prior to the opening time.

When the time for opening bids arrives, all sealed bids are opened. This procedure is open to the public. The property goes to the highest bidder. However, the GSA reserves the right not to sell the property if all of the bids are significantly below the market price of the real estate.

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If you send in a scaled bid, you may be able to modify it by sending in a second bid prior to the opening of all bids. However, once the opening has started, you can’t modify your bids.

There are three types of public auction. At the oral auction, a date, time, and place are specified by the GSA. You have to show up with the required bid deposit. An auctioneer handles the bidding, and you bid against others for the property. The highest bid wins.

A second kind of auction is also held in which you may increase your bids by sending e-mail, fax, mail, online, or in-person bids. This auction is held over a period of days until there are no additional bidders willing to raise their bid. Then the high bidder is awarded the property. Again, if all bids are too low, the GSA reserves the right to cancel the auction because the price does not represent the fair market value of the property. If it cancels, they may hold another auction at a later date.

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GSA properties are generally sold on a cash only basis. This does not mean you cannot get financing. It does mean you’re on your own to arrange financing before the bidding

Finally, the GSA also holds online auctions. Here all activities, including submission of bids and increasing the bid amount, are handled online. As before, the auction continues for a period of days until a high bidder emerges.

What Types of Property types the GSA Offer for Sale?

Because the GSA draws from throughout the federal government, the types of properties are varied. They include:

• Land
• Industrial
• Commercial
• Residential
• Retail

In addition the properties are scattered across the country. To find out what GSA properties are available in your area, point your Web browser to property disposal.gsa.gov/ Property

Furthermore, the GSA often has “hot” properties that it is anxious to dispose of. You can read a description of these at the Web site just given.

When you designate a city or area of the country you wish to find out about, you’ll be told about the property, the minimum suggested bid. and the date, time, place, and method of auction.

Investors Wanted
The GSA is looking for investors to help with its auctions of IRS property. It wants investors to underwrite these by agreeing to support minimum bids.

The way it works is that you guarantee to purchase the property at a minimum bid price. You get a list of available properties that includes a description of the property, the minimum bid price, and the expiration date of the bidding.

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The GSA will provide a title report, an assessed value, and the cost of utilities and other items. But you have to get this direcdy from the local office representing the property. Unfortunately, you often will not be allowed to inspect the properties in advance.

All you need to do is give the GSA a check for $5, and they will send you a registration packet. Then you can become the minimum bidder. At the auction you can let the minimum price stand and be outbid. Or if there is other bidding, you can bid again. However, if there is no other bidding, you’ve bought the property for the minimum bid. However, for agreeing to be the minimum bidder, the GSA will give you an “award.”

Therefore, you must be very careful! Unless you want to own the property at the GSA’s price, don’t bid on it. Check it out at propertydisposal.gsa.go\7 Propprry/IRS/.

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These properties are generally acquired from the IRS. You’ll get a deed, but there is no guarantee that the property does not have other Hens or encumbrances. In other words, the sale could be subject to a previous mortgage. Also, be sure to check out the title thoroughly.