How to Buy Property at Auctions

buying at auction uk

Many of us will have at one time or another attended in person an auction or at the very least have seen one in action on television. Auctions come in all shapes and sizes from local auctions selling off house clearance items to themed auctions such as film / TV memorabilia or those focused on agricultural machinery. The viewing the lots, the bidding and the hammer are all part of the process of buying from an auction – Sometimes it is just the cash in your pocket or credit card that will enable you to walk away with the item you won, though sometimes bank fund transfers and finance / mortgage agreements are required.

How to purchase property at auction is a popular topic and one which many people involved in purchasing (and selling) property will have at least investigated and most certainly been tempted by. When viewing property for sale online, especially via the major property portals such as Rightmove and Zoopla, listings will come up that are going to auction and showing a guide price. Most times the guide price is very attractive in being under market value, though the final sale price is most likely to exceed the guide price.

What are the advantages of buying by auction? The sale price is very much likely to be less than what you would pay if the property / lot was listed normally ie via an estate agency with no time restrictions on selling. Another big advantage to purchasing at auction is time in that you are likely to complete your purchase at a much faster rate on average (normally within 28 days).

Disadvantages of buying at auction do exist and these include you having to be prepared and ready to purchase upon the fall of the hammer for instance you will need the cash to pay within days or you will have had to arrange and have ready mortgage agreements in principle. The time for viewing the property / lots will also be limited as will the time be for you to carry out all investigations / surveys / reports. You are also not guaranteed that the property you have your invested time put in to will end up being yours as you can be outbid.

The process for buying at auction is not complicated and certainly not a scary way in which to purchase property. You are likely to grab yourself a bargain which for many will be worth the added effort.

Key steps in buying property at auction:

  • Find your property – Research local auction companies / property portal websites. Use the term ‘auction’ when searching. Register with the auction company and secure yourself a bidding account and either attendance in person or remotely for the day of the auction.
  • Investigation – Contact the auctioneer to book viewings and research all the required information you need in order that you make the right decision for you. Properties come up for sale at auction for many reasons and this might be because they are not suitable for everyday sales practises via high street estate agencies. Make sure you study in detail any and all legal packs for the property.
  • Finances – Make sure you have your finances in order so to bid on the property you are interested in. You will require either the cash and / or agreed mortgage in principle. Please remember that you may be halted if the bids exceed your finances – You are advised to set yourself a limit on bidding and not exceed this amount as when the hammer falls and you are the highest bidder then you’ll be bound by the terms and conditions of the auction.
  • Winning the auction – You will be required to pay the set deposit (usually 10% of the purchase price) for the property and from there the legal paperwork can commence between you and the seller. Once that hammer has fallen then you are the owner of the property so do think about any insurances you may require on it. The completion of the mortgage will also have to take place and this will include a survey by the lender to make sure the value of the property is worthy them lending on.

 

 

Christopher Walkey

Founder of Estate Agent Networking. Internationally invited speaker on how to build online target audiences using Social Media. Writes about UK property prices, housing, politics and affordable homes.

You May Also Enjoy

Breaking News

Homes on spooky street names like ‘bat’ and ‘hell’ sell for far above the national average

The Halloween street names that cost a fortune to live on A new study has determined which Halloween-themed streets are the most expensive to live on.  Streets with the word ‘bat’ in the name face an increase of 188.6% from the national average house price in the UK.  Streets that include the words ‘cauldron’ or…
Read More
Estate Agent Talk

Why Mortgages Shouldn’t Only Be Accessible for 9–5 Workers

As the modern workforce evolves, mortgage lending criteria are struggling to keep up. Across the UK, thousands of people who earn outside of traditional employment, from content creators and freelancers to contractors and entrepreneurs, are finding themselves locked out of the housing market, despite having stable and often high incomes. According to James Enos, National…
Read More
Breaking News

Property Sector is in ‘Wait and See’ Mode

Commenting on how the property sector is fully in ‘wait and see’ mode ahead of the Autumn Statement, Daniel Austin, CEO and co-founder at ASK Partners, said: “With the Autumn Statement looming, the property market remains in ‘wait and see’ mode. Buyers are pausing, and developers are holding back amid uncertainty over potential tax changes…
Read More
Rightmove logo
Breaking News

Rightmove streamlines tenant move-in journey with Renter Checklist

The UK’s largest property platform Rightmove has launched a new checklist for renters, streamlining the process of moving into a new rental home. The checklist guides tenants through each part of the rental process, from finding a property to picking up the keys. The new Renter Checklist is available now in My Rightmove, where people…
Read More
Breaking News

Industry Reaction to Renters’ Rights Bill Becoming Law

The Renters’ Rights Act has officially received Royal Assent, marking one of the most significant reforms to England’s private rented sector in decades. The new law will ban Section 21 no-fault evictions, replace fixed-term tenancies with open-ended agreements, cap rent increases, and introduce tougher property standards under the updated Decent Homes Standard. It also paves…
Read More
Rightmove logo
Breaking News

Rightmove data and commentary as Renters’ Rights gets Royal Assent

The UK’s largest property platform Rightmove shares data and commentary on the rental market as the Renters’ Rights Bill finally gets Royal Assent and becomes law. Key market data The average advertised rent of homes outside of London has reached a new record of £1,385 per calendar month (pcm). Average rents outside of London are…
Read More