There are many reasons why people choose to buy properties at auction rather than going through the traditional housing market process. For one thing, you are likely to be exposed to properties that would otherwise have passed you by. For another, you could even end up snatching up a property for a very tempting price. But if you have never taken part in a property auction before, it’s important to know what you’re stepping into. Coming prepared is vital to auction success, so here are the 5 steps to making sure you’re ready for bidding and buying.
Every month in the UK, thousands of properties go to auction. These auctions can be small scale affairs or big city auctions made up of hundreds of lots. You might not think that there are any property auctions happening in your area, but once you do a bit of digging you’ll be surprised at just how many there are. Catalogues are available both online and in print, and you can also find details of some local plots on popular moving sites like Rightmove. Be sure to look at the guide prices of properties but also bear in mind that the ultimate sale figure could be a lot higher than this.
Visit the property in person
When gearing up for a property auction, you can never be too prepared. Once you’ve done some digging online, take the time to arrange a viewing so you can get to grips with the property in person. As with any big purchase, you want to know exactly what it is you’re buying, and a visit is the easiest way to gain this knowledge. Take a look at the condition of the property and see whether there are any factors which could require expensive maintenance or building work. Most properties require some level of work once you’ve bought them, but this can range from redecoration to rebuilding, so you need to know whether your budget can handle the task ahead. Discovering this now could save you a pricey headache down the line.
Seek advice from a solicitor
Once you have narrowed down your interest to one or two key properties that you’re serious about investing in, download the necessary legal documents from the auctioneer’s website. You should read through them yourself of course, but it’s also helpful to send them on to your solicitor and ask their advice, as they are likely to have a firmer grasp on the logistics and terminology included. Your solicitor can then raise any queries with the seller’s solicitors, ensuring that there is no doubt about the property you’re looking to bid on.
Make sure your finances are in order
Like any house purchase, buying a property at auction is a big and pricey investment. You’ll need to have at least a 10% deposit secured before you can comfortably bid on any properties, and completion of your purchase will usually occur within one month of the auction itself. Make sure you budget effectively, because if you fail to complete your purchase you could lose your deposit.
Thankfully, auction finance bridging loans from trusted providers like Glenhawk can help you secure the necessary finances quickly, so that you don’t miss out on a great property investment opportunity.
Be alert on the day
Once the auctioneer’s hammer drops, the sale is legal and there is no turning back, so it’s important to be fully prepared on the day. Don’t forget to bring your ID along, and make sure you enter the auction with a set price limit in mind. Sticking to this will ensure you don’t find yourself paying more than you can really afford. Above all, don’t be timid. When your property comes up, go for it and have fun.