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By Claire Webb
Checkout a radio version of this story on Annenberg Radio News.
Treasure seekers in South Los Angeles have discovered a way to find loot and earn extra cash in a tough economy—storage center auctions.
Each month storage facilities hold public auctions of units where the tenant has fallen behind on rent or abandoned the space. Buyers come to a center and follow the auctioneer around from unit to unit and are allowed to bid on the contents of the space after taking a glance inside. They can either move on to the next one—or purchase the space and all the contents inside.
And you never know what you might find.
“Like Forest Gump says, you never know what you’re gonna get,” said buyer Jenny Alamada at an A-1 Self Storage center auction in Paramount.
Indeed, when the metal door of a unit is rolled up, you can see anything from mattresses, to home appliances to clothing, boxes and even jewelry. Buyers are allowed to walk past the unit up for sale, and shine a flashlight to see the inside, but no one is allowed to go past the threshold. Technically the unit is not theirs yet—so for legal reasons the center does not allow buyers inside until it is sold.
The economic factor
In tough economic times where the unemployment rate in Los Angeles tops 11 percent—regular buyers like Emmanuel Razo, who attended an auction at a US Storage Center in Inglewood with about 20 people, are seeing people flock to these auctions as a way to make extra cash.
“Last month there was more than I’ve ever seen,” Razo said. “When I first started there was maybe a handful of people, five to six, and increasingly its gone up to over 100 at any particular auction.”
Razo used to manufacture ladies shoes but turned to storage auctions about a year ago to earn money to subsidize his income. Now he resells items he finds at auction full-time. “Well, hopefully I can get some merchandise and make some extra money, some living money is what you want to call it. The economy is such that you’ve got to find a couple ways to scratch up a few dollars,” he said, attending a recent auction on Industrial Avenue in Inglewood.
The number of bidders at these auctions inspired by a listless economy is up across Los Angeles County, said Yuvia Cruz, Los Angeles district manager for US Storage centers. She has seen more of a following at the auctions in the past few months.
“Yeah, more buyers for sure,” she said.
Count Jason Overs among the new buyers. A substitute teacher in Los Angeles County, he began going to weekly auctions four months ago when his workdays were scarce.
“This is just something I do since the economy is kind of bad right now. Can’t really get as many jobs as I used to,” Overs said.
The road to auction
All storage centers have a slightly different set of rules. However, most of them have a similar process before putting a unit up for auction. According to Cruz, the US Storage can begin the auction process after 15 days without payment. She admits after the company goes through the legal requirements of notifying the tenant, and advertising the sale for two consecutive weeks before it is sold, the process from the first missed payment to auction takes longer.
“It takes about 2 months from start to finish,” Cruz said.
And owners can come at anytime up until the auction and pay the full amount they owe to redeem their things, but once the auctioneer yells “sold,” it’s done. Now the new owner must decide what to do with their new merchandise.
“You know you can put them up on Ebay, Craiglist, or tell a friend—see if they need anything particular,” Razo said.
Or swap meets are a popular place to sell wherever a buyer might find in the unit.
“Whatever you’re not able to sell on Ebay or Craigslist, you just let it go to swap meet for cheap. Everybody is looking for a bargain there,” said Razo.
The recent auction in Inglewood Razo attended sold six units and took in $1,260. Auctioneer Dan Dotson, who conducts many of the auctions throughout Los Angeles, takes a 20 percent fee from the total that day—so the higher the sale the better it is for him. But he said usually the storage facility does not make the money back it lost on the rent the tenant did not pay.
“Usually by the time it comes down to the auction, they might get 20 cents on the dollar, and that’s about it,” said Dotson.
Cruz, the US Storage manager, agreed: “We always lose.”
Still, buyers migrate to these auctions to buy whatever they can to resell and hopefully make some money in the meantime. When asked, buyers like Razo said getting in line for other people’s things is just a business for them. And many of them, like Overs, have found this is not only a way to combat the economic downturn, but also an exciting way to spend your weekdays.
“Just having fun doing it, seeing what’s out there and making a little bit of money,” Overs said.
