There are many things to consider when buying a property at
auction.
We have put together some key essential points to consider to
help you buy your dream property.
Buying at Auction
- Obtain a copy of the auction particulars from the auctioneers.
This may already contain certain key information or a separate
legal pack may be available.
- Make a thorough inspection of both the property and the
neighbourhood. Don't be afraid to ask the auctioneer if you have
any queries.
- Take your time considering the property and then, if you are
still interested, ask the auctioneers to keep you informed of any
alterations or amendments to the sale conditions (an 'Addendum').
Ask them to let you know if there is any possibility of the
property being sold before the auction date.
- Make sure you know how much the deposit will be and check
carefully which method of payment is required so you can arrange
for sufficient funds to be available.
- Take the property details to your solicitors and ask them to
reiterate the auction process and advise you on the legal
aspects.
- You would be wise to obtain advice on the condition of the
property as well as finding out any other relevant information,
including planning and building regulations. If you are obtaining a
mortgage or loan, then the surveyor acting on behalf of the lender
should also be able to advise you. Be careful to confirm the costs
before authorising the report.
- Armed with all this advice, together with the Terms and
Conditions of any loan, decide on the maximum price you will pay
for the property.
At the Auction
- It is very important to arrive at the auction well before the
advertised starting time. This is because any changes or additional
information about the property will be available in an 'Addendum'
or will be announced by the auctioneer immediately before the
auction itself. Such alterations may have a bearing on your desire
to buy the property.
- You can bid personally or someone else, such as an agent or a
solicitor can bid on your behalf. Some auctioneers will also accept
telephone or proxy bids for which the auctioneer will require
written authorisation from you and also your cheque for the
deposit, calculated on the amount of your maximum bid.
- Usually there will be a reserved price. The auctioneer will
state clearly if this is the case or it will be detailed in the
particulars or conditions of sale.
- If you are successful in your bid, you will need to sign the
contact and pay the deposit there and then. At the fall of the
auctioneer's gavel, you will be bound by the terms and conditions
of the sale and usually liable for the insurance of the property
from that moment. The date for completion when you will pay the
balance of the purchase price and take possession of the property.
This will be clearly stated in the conditions of sale.
- If a property remains unsold, the auctioneer usually has
authority to sell it privately in the room immediately after the
sale, so it is sensible to register your interest at once even if a
sale cannot be agreed straight away.