Thread: Auction Ethics Question

Originally Posted by Satyra From PhoneSmart

Wouldn't announcing that the tenant is there discourage other buyers from bidding, specifically to avoid confrontation... and on the other hand, if no one else bids on the unit, isn't there a possibility that the original owner of the unit could get their belongings for less than what is owed. Or does the bidding start with the amount owed on the unit?

I don't think it would be an issue with my regulars. Years back I mentioned to one that the tenant may show up. He told me if he likes the unit they will not get it cheap. If the tenant causes any issue I will have them off the property very quickly.

Originally Posted by DFWRealist

My responses below are from my personal experience and from the auction buyers point of view:

1- The times a tenant was present and we were informed they were present... It discouraged me from making any bids. However, it did not discourage all buyers from bidding as all units were sold.
2- Your second question was a little unclear to me but... The sales I have attended where tenants were announced as present, the tenants were NOT allowed to bid on any unit. Their own or any other. All units have sold where the tenant was there. If it happened to be that their unit did not get a bid, it would be deemed a "no sale" and the contents would then be owned by the facility. I am not sure what the management would then do with the tenants former property at that point.
3- The auctions I have attended, the amount owed to the facility is never disclosed to the buyers attending. The opening bid starts at whatever amount a buyer offers to open bidding or the auctioneer will start with a number that is fitting with the contents of the unit. Sometimes that number gets no response and the auctioneer will reduce the bid amount until a buyer jumps in and accepts that bid amount. The total past due amount for the unit is never a factor to a buyer as again, that figure is not disclosed to the buyers attending.

If the owner can't bid on their unit, nor any other units... What would be the point of them being there?

We don't "stage" units for auction. We will from time to time have a build up unit we auction off. Thing left from tenant that moved out. If you don't see anything of value in the unit don't bid on it. Its that way with all units so why do we need to disclose how the unit arrived at auction? Bid with your eyes not with your mind. As for letting a tenant on the property that has a unit going up for sale... NO WAY!! I have had auction tenants taken from the property in police cars for trying to "crash" the auction. As far as I am concerned they are past due and are locked out. If its a friend or a relative bidding and I don't know it thats fine with me. What else can you do.

Originally Posted by Satyra From PhoneSmart

If the owner can't bid on their unit, nor any other units... What would be the point of them being there?

I have to stand up for the owners/management in responding to that question. The tenants owe a significant amount of money for non payment of rent so, I don't see how they should ever be allowed to essentially play "Lets Make a Deal" with their unit in hopes of getting it for less than they owed. I have never seen it in Texas but, maybe other places it has happened? I don't know.
From what I have seen... Tenants who attend the sale have usually made a plea to the bidders to let them have some of their sentimental items back. Most of the tenants who have shown up at the sale... Have been very humble and didn't make a scene at all.

Originally Posted by DFWRealist

I have to stand up for the owners/management in responding to that question. The tenants owe a significant amount of money for non payment of rent so, I don't see how they should ever be allowed to essentially play "Lets Make a Deal" with their unit in hopes of getting it for less than they owed. I have never seen it in Texas but, maybe other places it has happened? I don't know.
From what I have seen... Tenants who attend the sale have usually made a plea to the bidders to let them have some of their sentimental items back. Most of the tenants who have shown up at the sale... Have been very humble and didn't make a scene at all.

DFWR In PA the tenant is allowed as it is a public sale. It has not happened yet, but you never know.

DFW, in Texas the tenant is allowed to bid on the unit, and so am I. If it came down to it, I would simply outbid them and sell off the stuff to make up the lost rent. If they owed $200 and their bid was $150 I would let them have it, as it must be cleaned out in 48 hours, and I would not re-rent to them.

Originally Posted by RichardandBeverly

DFW, in Texas the tenant is allowed to bid on the unit, and so am I. If it came down to it, I would simply outbid them and sell off the stuff to make up the lost rent. If they owed $200 and their bid was $150 I would let them have it, as it must be cleaned out in 48 hours, and I would not re-rent to them.

(Also @ Dakselfstorage)

I am stunned that a tenant is allowed to bid but, as I said earlier, I have never seen a tenant attend and bid (that I knew of). I never knew they could and I assume most don't either.

Richard & Beverly, you brought up a very interesting scenario that I have also not encountered but, I knew was allowed.... Managers bidding on a unit.
It is only my personal opinion but, if I saw a manager bid on a unit, I would never attend another sale at that location because, I would have a hard time accepting that the unit had not been gone thru by them at some point. Even if they hadn't, it just seems unfair but... Just my opinion.
I would guess that managers have done this before but, they likely had someone else bid for them and I never knew.
My opinion may be different if the facility used a licensed auctioneer because, they always appear to stick to every rule and law... both the auctioneer and management.

Sorry, not a diss on anyone who doesn't use an auctioneer. Just a matter of perception from a buyers point of view.

In most states, storage auctions must be conducted as public sales...which means you can't pick and choose who attends...including the tenant or friends of family of the tenant. As long as the tenant doesn't cause any problems, then they are legally allowed to be there, and the facility owner could be in trouble if he/she doesn't allow the tenant at the auction.

Originally Posted by DFWRealist

I have to stand up for the owners/management in responding to that question. The tenants owe a significant amount of money for non payment of rent so, I don't see how they should ever be allowed to essentially play "Lets Make a Deal" with their unit in hopes of getting it for less than they owed. I have never seen it in Texas but, maybe other places it has happened? I don't know.
From what I have seen... Tenants who attend the sale have usually made a plea to the bidders to let them have some of their sentimental items back. Most of the tenants who have shown up at the sale... Have been very humble and didn't make a scene at all.

That would be nice of the buyer to allow the tenant to retrieve some of their sentimental values... And at the auction point, the tenant should be a little more at ease, considering that a nice amount of time has lapsed since their default. Now I understand why one would be there without the privilege to bid. Thanks.

Since it is a public auction, I have as much right to bid as anyone. I have not had to do it yet, in 13 years, so I doubt it will come up. However that does not change the law in Texas, so if I have to I will.