Over the last decade, auctions have become a popular way of buying property.
Along with the potential to save tens of thousands of pounds on the value of the property, the speed at which you can secure your desired home is greatly increased. Often it only takes about 4 weeks from viewing the auctions brochure until exchange of contracts. Completion usually then follows within 20 working days.
A property auction is effectively a collective sale, usually held at an auctioneers' salesroom, designed to provide a way of selling properties quickly and easily.
Properties come to auction for a number of reasons:
Prospective buyers attending a property auction will need to have assessed the properties on offer, viewed the ones they are interested in, organised funding, undertaken the required conditional and legal checks, whilst settling on a preferred buying price.
At the ‘drop of the hammer’ contracts are exchanged and the property is sold. It is therefore very difficult and costly to pull out of a sale after the hammer falls.
Having made the decision to purchase a property at auction, the first thing you should do is obtain an auctions brochure or view properties to be auctioned on the auctioneer’s website.
With a location and budget in mind you can then arrange to view any properties you are interested in. This can be done through the local Estate Agents.
When viewing the property, be sure to assess its condition paying particular attention to electrical wiring, central heating and dampness, etc.
Once you have identified a desired property, the next step is to register your interest with the auctioneer prior to the auction. This will ensure the property is not sold before the auction to someone else without you knowing.
When buying property at auction there are a number of preparations you must make before you can bid for a property. These will often involve financial outlay:
Even though you may have spent money on these preparatory activities in this way, there is no guarantee that your property bid will be successful and as such your money may be spent in vain.
Obtaining a property survey will enable you to ensure that the property is in a fit state before you bid on it. The cost of doing this will depend on which type of survey you choose. The options are:
Read our Property Survey Guide for more information.
Providing the survey does not highlight any significant issues or problems, the next step will be to arrange the finance on your purchase.
Before you attend the property auction you should first ensure all of your finances are watertight, as there will be legal obligations and penalties if you are unable to complete the transaction.
Unless you are a cash buyer, you will need a firm offer from a mortgage lender before you can bid. It is advisable to seek professional mortgage advice. Mortgage offers can take weeks to process so do not delay your appointment and let your advisor know about the auction so that things can be progressed quickly.
For more information on property finance read our Guide to Mortgages.
Before attending the auction it is advisable to appoint a property solicitor. Once appointed, your solicitor will need to view the property’s legal pack. Typically this will include;
These packs are available to view online at the Auctioneers website or a photocopy of the pack can be ordered for a small charge from the Auctioneers.The pack can also be to viewed at the Auctioneers offices or in the auction room on the day of the sale.
It is important that either you or your solicitors inspect the legal pack prior to auction to make sure the property has a clean bill of health.
Arrive at the auction with plenty of time to spare. Important announcements are made at the start which could relate to the property you wish to buy.
Pick up a copy of the addendum; it notes any alterations to the properties being sold at auction.
On arrival you will also need to complete the following steps:
Once the bidding begins the auctioneer will describe each property in turn, he will then suggest an opening bid and invite bids from the floor.
When the highest bid is reached and no more bids are forthcoming, the auctioneer will drop his hammer and the property will be sold.
When at an auction, do not get drawn in to bidding more than you can afford to pay. Remember, once the hammer drops you are obliged to meet the price.
Should your bidding prove successful you will become the new owner of the property and you will need to:
Countrywide Property Property Auctions and their sister company Westcountry Property auctions make up one of the UK’s largest regional property auctioneers, holding more than 25 auctions in England, Wales and Scotland each year. To find out more about the properties for sale at our forthcoming events, contact Property auctions or call 020 3151 9172.
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