Buying a property at auction

Have you ever considered buying your next house through an auction? Auctions can be an excellent way for you to save time and get a bargain. We’ve compiled our top points to think about when buying a property during auction.

Before the auction

1. Research properties and auctioneers in the region

Contact local auction houses to determine the location that you are interested in. They will inform you about upcoming auctions, and will join you on a mailing list to ensure you receive the most current auction catalogues.

2. Set up viewings and ask questions.

Make contact with the auction house once you’ve found a property you like. It is important to inspect the building and the surrounding area. Consider taking a builder or handyman along to determine what you might need to be done to the property and what it is likely to cost. If you have questions do not hesitate to inquire from the auctioneer.

3. Find a copy of the auction information

Although the particulars will include important information, you may require an additional legal document to get the complete picture. Although searches are usually part of legal documents, your solicitor might need to conduct them prior to the auction. Legal documents vary between properties. If you are in doubt Consider asking a lawyer to look over the legal documents for undiscovered covenants or loopholes which could cost the buyer more than they bargained for.

4. Be prepared to act fast

While it is important to be patient when considering the property you are interested in, there are usually only four weeks between publication of the auction catalogue and the actual auction. You be required to act fast.

5. Stay on top of things

The auctioneers can inform you of any changes or additions to the auction’s conditions. This is referred to as an Addendum. If you’re interested, ask them to inform you in the event that the property will be sold prior to the date of the auction, this has been known to occur at times.

6. Set your budget

Think about the highest price you can afford to purchase the house. Although auction homes are usually less expensive than the market value, repairs are almost always necessary. If you’re fortunate enough to be a cash-buyer, you will need finance in place before bidding. It is important to know the amount of your deposit as well as the payment method is required in order to secure sufficient funds.

7. Pay attention to the fine print

It is essential to read the conditions and terms of an auction house before putting in your bid. It is important to familiarize yourself with the terms of sale and what must be paid and when–you don’t want any surprises at the time of auction.

What do you need to consider when attending an auction?

7. Keep on time

It is advisable to get to the auction prior to the scheduled start time. Additional information or changes to the property will be included in an Addendum or will be announced by the auctioneer prior to when the auction begins. You must be aware of any modifications that could influence your decision to buy.

8. Find out what the differences are between reserve and guide price.

Each auction property is initially offered at an initial guide price. However, each property may also be subject to a reserve. The price that is the starting point at which bidding begins is referred to as the guide price. However, the reserve price represents the highest amount that the seller will accept. The reserve price will not be revealed to bidders, but it could be as much as ten percent more than the guide price so keep this in mind when you are bidding.

9. Be specific in your solicitations

Make sure you are certain of your bids. Some auction houses provide you with the option of a paddle or similar to make sure you’re identified by the auctioneer when you bid. It’s easy to get lost but keep your cool and within your budget. The auctioneer must make it quite apparent which location and what current bid is in the room.

10. If you can’t bid your own way, someone else should be able to bid on your behalf

A solicitor or agent can substitute for you if you are unable to bid. Some auctioneers accept telephone or proxy bids. In these cases the auctioneer needs to obtain written permission from you and an e-check for the deposit. This is calculated by the amount of your highest bid.

11. If you do succeed by securing the gavel, you accept the conditions and terms when the gavel falls

If you bid successful and you are successful, you must to take the contract in writing and pay the deposit there and after that. At the fall of the auctioneer’s saw, you are bound by the terms and conditions of the auction and responsible for the insurance of the property from that moment. Refusing to participate in the sale after this could result in huge after costs.

12 .Make sure you’re aware of the payment terms and deposit terms

The majority of property auctions require a ten per cent deposit on the day of auction and require two types of ID. The typical auction will give you between 14 days to six weeks to complete and pay the portion of the purchase. The conditions of sale will clearly state any outstanding charges or details regarding completion.

13. If the property is not sold and you are unable to sell it, you might be able to buy it privately

If the property cannot be sold, the auctioneer might be able to sell it privately it in the same space in the same manner as the sale. It is important to notify the auctioneer prior the sale and be there at the end of the auction.