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Home Buying
Guide
Click for Full Contents
How to Find Your New Home / Property
Click for Full Contents
Buying at Auction
Background
to Auctions
How to buy at auction
Finding
auctions
Intro
A
few tips on Finding Auctions
Useful websites
Background to UK Property Auctions
This is where great deals can be made. You can save up to 40% on a property by buying it at auction.
Mortgage lenders often put up their repossessed properties for sale, usually at deliberately reduced "reserve" prices to ensure they sell quickly. Local authorities and housing associations use them for similar reasons.
These guys have a lot of flats/houses on their books and don't seem to see the value of them as much as you might. They basically just want to get rid of them and recoup some money as fast as possible .
Other properties put up for auction will be those with development potential or difficult to sell.
Of course there are some downsides to buying property at auctions - though these can be dealt with fairly easily.
One is that you'll need to have got your valuation/survey, conveyancing and mortgage sorted beforehand.
Even though you've paid up to a few hundred pounds for these, there's no guarantee you'll be the successful bidder.
However, if you've got the spare cash the sort of savings possible could make it very worthwhile.
You also have to move fast and there is much greater uncertainty than buying a home the normal way - until the auctioneer's hammer falls on the highest bid.
The timescale from the announcement - basically when the auction catalogue showing all the "lots" for sale is printed - to the date of the auction is often only three or four weeks.
However it's quite possible to arrange everything within that time if you organise yourself properly.
Basically the process is the same as that outlined in Completing Your Property Deal ie as if your offer has been accepted and you now have to arrange the actual purchase. (Of particular relevance would be the section on Get ready to hassle - to make sure things move quickly)
Many normal individuals from all types of different backgrounds, with no experience of auctions, have done it succesfully and are very glad they did.
A further benefit of buying at auction is that you can buy your home more quickly because it isn't part of a slow moving and stressful chain.
Read on:
How to buy at auction
Finding
auctions
Buying Tips
How to buy at auction
If
you're nervous about the auction process (which isn't nearly
as scary as it's made to look on films) you could get your
solicitor or surveyor to do the bidding for you. You can
either stand beside them or, if you prefer, could stay at
home clutching teddy and waiting for the phone to ring with
the news.
You should always set a price limit
on the property.
If you're doing the bidding yourself don't get carried away and exceed it. Just because someone else is bidding higher doesn't mean the property has suddenly gone up in value.
You would know what to pay for your chosen property because you'd have conducted a valuation/survey and the conveyancing and arranged a mortgage beforehand.
The
mortgage
lender will need to be satisfied with the valuation so make sure they're
in agreement with your arrangements ... otherwise there'll be a delay.
You should also consider having a full survey done to protect yourself. Perhaps
the property is for sale because it's got serious structural problems... which
a simple valuation may not pick up... It may cost more but it will save you from
a potential huge loss.
If your bid is successful you are legally bound to buy the property and will need to put a down payment deposit there and then of 10% of the property's price.
You would sign the contract (which you've seen beforehand) in the sale room.
The seller is legally bound to complete on the day. You would pay them the rest of the price (ie 90%) within the next 28 days.
If necessary you could use a bridging loan to pay this off. These are short-term loans which are often used for auction purchases. Click here to read more about bridging loans.
A good idea is to attend a few auctions as an observer and get a feel for them.
Read
on:
Finding
auctions
Buying Tips
How to find auctions
A few tips to finding Property Auctions
Useful property auction websites
Intro
Unfortunately,
finding the auctions is not at all easy.
Most auction houses only send
out information to trade professionals. Advertising and publicity are expensive
and there even seems to be an underlying attitude that they don't really need
the general public.
So you'll be fairly hard pressed to track them down. But - with the huge savings you could make - it'll be worth it.
A few tips on finding auctions
The local phone directory may have quite a few entries for auction houses. But you'll find that these often turn out to be auctioneers for unrelated subjects like art or furniture. There may hardly be any for property.
The other thing to bear in mind is that the areas covered by auction houses are not necessarily local to them. An auction house in Northern Ireland may well be selling property in London.
One method of finding auctions is to take note of any "For Sale" signs which mention that the sale will be by "Auction".
Phone the number on the board. It'll either be an Estate Agent or the auctioneers themselves.
If it's an Estate Agent ask them who the auctioneers are. Then phone the auctioneers and ask them to put you on their mailing list. There's often a charge for this.
Even if you simply want the catalogue - showing what's for sale in the forthcoming auction - you may well have to order it via a premium rate phone number, costing £1.50. (Strange but true).
However if the experience of this writer is anything to go by, getting information on auctions from Estate Agents is not that staightforward.
The agents may try to strip you bare of any information - just in case they can "help you" - before giving you details of the auction house. And then the auction house might not send you anything despite, in our case, several increasingly irate phone calls.
Time is precious. On average you've only got three or four weeks to play with. So you need to know what's coming on at auction as soon as possible. And to get a head start over your competition you need to be one of the first to get the catalogue - ie as it's printed and released - just like the trade professionals.
It's not much good getting it a week before the auction takes place.
Useful websites
Basically finding auctions is a major pain but worth the slog. There are various websites that can help you cut out the effort by providing this info.
Some are free but the problem with these is that they only give limited info and you don't know what you're missing. Typically they've been put out by a small group of Estate Agents and are out of date.
We tried cobbling together as many of the freebies as possible but frankly the picture we got was inadequate.
The best way to go really for websites is to pay for one of the subscription types. It may cost but at least you know that the info is complete and up to date.
Try a good search engine like Google and search for "UK property auctions" or a similar phrase to find the best property auction websites.
Read
on:
Auction
Buying Tips
Auction Buying Tips
Don't buy a property before you've sold yours ie before the completion has happened - assuming you're relying on that sale to buy at the auction.
Don't buy a property without having had a survey done. Not only will you limit the potential nightmare of building problems but you'll also have a basis on which to bid, as well as knowing your mortgage limit and how much of a deposit you'll need.
Always set a price limit on the property.Don't get carried away and exceed it.
To read more on this subject please see the list below or your mortgage guide or your home buying guide
Read enough? Just want a quote? To get your best mortgage quote quickly and easily we can put you in contact with a recommended mortgage adviser. It's free, completely confidential and there's no obligation at all. Simply fill out the form below
Read on about other ways to look for your home
Contents of How to Find Your New Home / Property
Go back to contents of the Home Buyers Guide
Read about How to get a Mortgage
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How to Find Your New Home / Property
What
can you afford?
What
do you want?... Where?
Price
Differences
Don't overpay for being almost trendy
"Value Added"
homes
Howto look for your home
Estate
Agents
Using the Internet
Relocation agents
Buying
at an auction
Self Build Homes
Guide to researching your chosen area
Save time money and effort with all the latest tips and trade secrets.
We tell you everything you need to win the race for that dream home... how to get your seller's Estate Agent onto your side... how to get properties for a 30% plus discount.. how avoid being gazumped at the last minute and more.
Click on your chosen subject below to access this invaluable FREE information.
Please note, this information is NOT necessarily RELEVANT in Scotland
Quick Outline of the Home Buying process
What
you're up against
How to Find
your Property
About the Valuation and Survey
About Conveyancing / The Legal Stuff
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