Buying a property at auction can be a way to snap up a bargain; however, caution is needed. Here we look at whether an auction could be the route to your dream house.
Before the auction
1. Research auctioneers and properties
Get in touch with property auction houses in your selected area. They will add you to a catalogue mailing list.
2. Arrange viewings
Arrange viewings for properties you like. Inspect them closely and consider taking a builder to identify prospective work and costs.
3. Get the auction particulars
The particulars will provide key information, while a separate legal pack may provide more details. If searches are not part of the legal papers, ask your solicitor to take care of this pre-auction.
4. Act fast
There are usually only four weeks between the auction catalogue being published and the auction itself.
5. Stay informed
The auctioneers will keep you informed of alterations to the sale conditions, which are known as ‘addendums’.
6. Set a budget
Consider the top price you will pay, the deposit, and the cost of any renovations.
7. Small print matters
Check your auction house’s terms and conditions – by bidding, you agree with them.
8. Auctioneer qualifications
Your auctioneer should be NAVA Propertymark protected. More auction advice is available from the HomeOwners Alliance.
If you need a homebuyers report Cambridgeshire or elsewhere, a quick search such as ‘homebuyers report Cambridgeshire’ will bring up lots of options.
At the auction
1. Be on time
Arrive before the auction starts and watch for any addendums.
2. Guide and reserve prices
The guide price is the price bidding commences at, while the reserve price indicates the lowest figure the seller will take. The reserve price can be up to 10 per cent above the guide price.
3. Terms and conditions
If you win, you pay the deposit and sign the contract. Terms and conditions apply and you are liable for the property’s insurance.
4. Meet payment terms
Auctions usually ask for a deposit of 10 per cent on the spot plus two types of ID. You then typically have between 14 days and six weeks to pay the remaining balance and complete.
5. Unsold property
If a property is unsold, auctioneers can sell it privately following the sale.