All you need to know
Purchasing a property at auction can be a rewarding and exciting experience, offering opportunities to acquire property at potentially lower prices. However, it requires careful preparation and a clear understanding of the process. Here’s an in-depth guide to help you navigate the auction process effectively.
Understanding the Auction Process
Auction properties range from residential homes, commercial buildings, land plots, and even unorthodox properties. Firstly, start by browsing through available lots, which can be done by contacting auctioneers directly or using property portals like OnTheMarket.com and SDL Auctions. Listings typically provide a guide price, property description, location details, photographs, and viewing instructions.
Guide and Reserve Prices
The guide price is an indication of the seller’s minimum expectation. This can be a single figure or range, and is subject to change before the auction. The reserve price is the minimum amount the auctioneer will accept, and it is usually set within the guide range, but remains undisclosed to bidders. Being in regular contact with the auctioneer for updates on these prices is a key step to securing your property of choice.
Viewing the Property
Before you bid, take time to view the property. Auctioneers will typically offer block viewings at set times. Confirm a date and time and arrive prepared, as some properties may not be in a habitable state and could pose various hazards. Take accurate measurements and inspect the property thoroughly to avoid any post-purchase surprises!.
Legal Considerations
Before the auction, review the legal pack provided by the seller’s solicitor. This pack includes vital documents, such as the conditions of the sale, title details, leases, searches, planning permissions, and plans. Consulting with a legal entity or licensed conveyancer to review these documents is highly recommended. They can identify any potential legal issues and help you make an informed decision.
Financing Your Purchase
Getting your financing in order before the auction is vital. If you need a mortgage, ensure your lender’s valuation and survey are completed prior to bidding. On auction day, you’ll need to pay a 10% deposit immediately if you’re the successful bidder. Therefore, you’ll need to have funds ready in a cleared form, such as a banker’s draft, building society draft, or debit card.
Registering and Bidding
On auction day, arrive early to register and secure your bidding number or paddle. Listen closely to the auctioneer’s opening remarks, which will provide essential information about the auction process. Be clear and confident when bidding. If your bid is successful, you will immediately enter into a legally binding contract with the seller.
For those who cannot attend the auction in person, many auctioneers offer remote bidding options, such as telephone or internet bidding. These services should be arranged at least 48 hours in advance to ensure your participation.
After the Auction
If your bid is accepted, you will need to sign the Memorandum of Sale and pay your deposit on the same day. The auctioneer will send the signed documents to both your solicitor and the seller’s solicitor to begin the process of completion, which typically occurs within 20 business days.
Key Tips for Success
Do Your Homework: Research the property and the local market meticulously.
Stay Updated: Keep in regular contact with the auctioneer for any changes or updates.
Enlist Professional Help: Engage with a solicitor or conveyancer to review legal documents.
Prepare Your Finances: Ensure your funds are ready and available for immediate deposit and subsequent payments.
Be Decisive: On auction day, bid confidently and clearly to avoid missing out on the property.
Another additional consideration is the opportunity to submit post-auction offers. If you are unsuccessful in your bid, you might still have the chance to purchase remaining unsold lots from the day. Auctioneers will provide a list of such properties, allowing you to submit an offer.
Through following these guidelines and careful preparation, buying a property at ctallauction can be extremely rewarding. It offers the potential to secure unique properties at competitive prices, while adding an element of excitement to the property acquisition process. As always, reach out to a professional for further advice on your specific circumstances.
Your property may be repossessed if you do not keep up repayments on your mortgage.