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

Home and Living

How to Protect Your Property from Flooding and Water Damage

Flooding and water leaks can cause significant damage to your home or office. However, many issues can be prevented by taking proactive measures to protect your property. In this article, we’ll explain how to minimize risks and prepare for potential water-related threats. 1. Inspect and Maintain Your Plumbing System One of the most common causes…
Read More
Breaking News

ONS House Price Index – November 2024

Headlines Average UK private rents increased by 8.7% in the 12 months to October 2024 (provisional estimate); this is up from 8.4% in the 12 months to September 2024. Average rents increased to £1,348 (8.8%) in England, £766 (7.9%) in Wales, and £976 (6.6%) in Scotland, in the 12 months to October 2024. In Northern…
Read More
Breaking News

Foxtons Lettings Market Index October 2024

Headlines October saw the highest level of new stock entering the market, with an 8% increase from last year, the highest increase in four years October’s demand is marginally lower than last October and decreased 32% from September, as expected during this time of year Following a yearly high of £593 per week this September,…
Read More
Breaking News

Breaking Property News 20/11/24

Daily bite-sized proptech and property news in partnership with Proptech-X.   Proptech powered lettings service for BTR developers needing pre-approved, quality tenants at speed gets funding A proptech-driven letting agent has secured close to £500,000 during its first equity investment raise. Property Sense, headquartered in Stockport but operating nationally, secured the half a million pounds in…
Read More
Kerb appeal
Estate Agent Talk

Why November and December are the best and most affordable months to buy

Buyers and sellers looking for the right time to move can consider top reasons from property experts to start the process this November and December. The autumn and winter months may not be the first that come to mind when considering a move, but potential buyers and sellers can be reassured by the experts that…
Read More
Breaking News

Farmers protest outside Westminster today in anger at the IHT ongoing debate – expert legal view

With today’s news about farmers set to protest outside Westminster in anger at the IHT ongoing debate, Tom Gauterin, Director at national law firm Freeths, said: “Although it is good to hear Mr Reed last week suggest that the Government is listening to farmers, today’s protests would suggest otherwise with the extent of their concerns…
Read More