A Target backpack can cost around $30. A 2,300 square-foot home in northwest Harris County sold at an auction for less than that.
Penny Mansion, a penny auction real estate company, sold the home for $26.12 on Sunday, June 23 to Melone Issacs of Houston. Harris County Appraisal District records reveal that the house was appraised at $128,000, according to an article by The Houston Chronicle. The home, located at 14511 Royal Mountain Drive in Houston, also includes four bedrooms and two bathrooms.
A Harris County home costs $26.12? There must be a catch.
If you think $26.12 is far too low for a house, you’re right. There is a catch. Like most penny auction sites, Penny Mansion requires bidders to register and purchase a series of reports on the house (housing area report, green home energy report, inspection report and home valuation). This can cost around $200, and must be paid before the interested buyer places a bid.
The amount for a home increases by a penny for every bid place. Perspective buyers can purchase additional bids for the home for an extra cost. After a specified amount of time, the person with the highest bid wins the house.
“We want to try to help people get back into homes and build a sustainable model so we can continue to do it,” Penny Mansion president, Tommy Allen, told KHOU.
The Better Business Bureau in Houston warns perspective buyers that online penny auctions are a mix of legitimate and non-legitimate sites. Penny Mansion, however, has no complaints filed with the Better Business Bureau. Allen also told KHOU that 100 percent of the auction proceeds will go to charity.
With all of the auction fees (for the reports and extra bids), Issacs ended up spending much more than he would on a Target backpack. However, he now gets to brag that his house by itself technically sold for $26.12.