Although, a daunting task, buying a property at auction can be your first step on the property ladder if you are a beginner. The very concept of buying at an auction, with seasoned property investors participating, can be unnerving, but it is an affordable way for you to get going. A little effort on your part such as research, finding mortgage, appointing a surveyor and appointing a conveyancing solicitor will see you through.
How to start?
When entering the world of property auctions for the first time, equip yourself with as much knowledge as possible. You can do this by engaging in research, signing up to mailing lists of auction houses in the area where you intend to buy the property, visit auctioneer websites and go through them in detail and download legal packs of properties which attract you.
Contact and seek advice from your neighbours, colleagues and friends who have purchased property at an auction. Having been through the process already, they may have useful words for you.
It is strongly recommended that you visit an auction process to get familiar with the environment and the proceedings before attending your first auction with the intention of buying. As an auction process is a competitive place, visiting it at a prior occasion for getting acquainted with the surrounding, will help you feel comfortable at the time when you visit it for the actual purpose of buying.
Find a mortgage
If you need a mortgage, arrange early, before you find a potential property. Have a mortgage ‘in principle’ which will help you set your budget so that you will know what you can afford and speed up the process required for finalizing the buy once you make the winning bid. Ensure that the lender completes within 20 days as this is time you have to complete the process.
Visit, inspect the property and appoint a surveyor
If you are interested in a property, visit it multiple times to make sure that the property is right for you. You will know whether it is according to the description you have from the agents. Take the services of Chartered Surveyor to review the property for you and spot any structural problems. An expert will also give an independent estimate of the property’s worth in the area. Armed with this, you will know your bidding limits.
Appoint a conveyancing solicitor
Appointing a property lawyer will ensure that the property is free of any legal issues which may prove to be a barrier when going to sell on the property. The expert will examine the legal pack to make sure that the property is not unmarketable.
Stick to your budget
You may be tempted to go just a ‘little bit’ when bidding at auction, but it is strongly recommended to never go beyond what you have come planned with. Stick to your budget and not let emotions take the better of you. Remind yourself that you have allotted your budget for a reason, only after a careful analysis. In case you succumb to the ‘extra’ then you may not afford the 10% deposit at the auction if you win.