Buying property at auction UK is exciting as well as potentially profitable and involves the steps:
1. Identifying and locating a property auction
You’ll need to find out when and where an auction is going to take place. For this, go through the property papers and magazines or talk to local estate agents.
2. Finding the right property
Once you’ve found an auction, get hold of its catalogue and spend time studying it and not act ‘at the moment’. You may be lucky going by your gut feeling but it is always better to be prepared.
3. Viewing properties
Once you’ve identified the properties you’re interested in, contact the auctioneers and arrange a viewing and be sure about every facet of the property you intend to bid. Very often, auction properties are in a poor state, requiring lot of repair work, so it is advisable to take a builder or an architect with you to find out the exact condition of the property, and the likely cost involved in restoring it. You need to act quick as there is generally four week time between the publication of the auction catalogue and the auction.
4. Research the property
Ensure thorough research of the property before buying property at auction UK and compare the price and condition of the property to similar others for sale in the vicinity by talking to local estate agents.
5. Legal procedures
When you express an interest in a property to the auctioneers, there is usually a legal pack available for you to read. It is essential that you grasp it thoroughly and have your solicitor check it out. Do not hesitate to ask questions if you’re not sure about anything. It could contain covenants or certain legalities which could have potential implications on the value of the property.
6. Arranging your finances
You should have finances ready with you prior to auction (you will have to deposit 10 per cent on auction day if you are successful) and must come up with the remaining 90 per cent in the next 28 days. If you need a mortgage, it is prudent to have discussed all of the financial implications with a bank or building society, and have a mortgage arranged in principle.
7. Go to the property auction ‘armed’
Go to the auction venue fully prepared and homework done. It is always a good idea to have a dummy run as an observer and experience the auction as a spectator before going to one to actually bid. You don’t actually have to be there in person, as you can bid by telephone.
8. The property auction
On arriving at the auction, you’ll need to register. Make sure to bring identification and cheques with you for the 10 per cent down payment. Auction houses can be pretty crowded affairs, so reach early and be comfortably placed among the front rows. As the bid starts, make sure you are clearly seen by the auctioneer and that he is aware of your bidding.
Make sure you don’t get carried away. Have a clear figure in your head that you won’t exceed because it can be very tempting to go over budget, particularly if you’re very much interested in a property and have invested a lot of time and effort prior to auction. If you are not sure about yourself, then you can take someone along to do the bidding for you.