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A public auction is the sale, open to the public and previously announced, of objects or goods to the highest bidder.

This type of sale and purchase is increasingly used in the real estate market, mainly due to the lack of assets for sale in times of market boom, which can cause a concurrence of offers on the same asset among several potential buyers interested, as well as the desire of the owners to get the best offer in times of market slowdown, encouraging interest through several bids.

This sales procedure is traditional in other fields such as the art, agricultural, fishing or livestock markets, but has more recently been introduced in the real estate market, particularly in the sale and purchase of large real estate assets or real estate portfolios.

The main advantages of this type of contract are as follows:

Profitability: in principle, the seller will achieve a better price than he could obtain on the market through closed and independent offers.

Security: the acquirer has a more or less extended period of time and somewhat more information to evaluate the asset offloaded, to study its charges and yields and to be able to make a more informed offer. This security has the disadvantage that the final winning bid is usually an immovable and binding price or offer, conditional only on the positive outcome of the audit process which must verify the prior information provided.

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