When buying a house at auction, it’s important to be prepared. Property auctions are often fast-paced and frenetic – and without the right know-how, it’s easy to get carried away in the excitement of the moment.
Before you attend a house auction, we recommend that you brush up on the process, in preparation for the event itself. Here’s a few tips to help you.
Buying a House at Auction – Practical Tips
Financial matters. Purchasing a property at an auction is very different to buying from a high street estate agent. To begin with, if your purchase is successful, you’re likely to be charged an administration fee. You’ll also be required to pay a deposit on the day – which can be paid by cheque or bankers draft. Note – it cannot be paid by cash. This deposit is 10% of the final price (a minimum of £3000), and you must then pay the remainder within 28 days.
Proof of ID. If you’re the successful buyer, you’ll need to provide proof of ID and address. This is due to current money laundering regulations. Acceptable forms of ID include your passport, photo driving licence or resident permit (issued by the Home Office). Proof of address must come in the form of a utility bill (last three months), tax bill or bank statement. All documents must be original – not photocopied.
Responsibility when purchasing. It’s your responsibility as the buyer to check all sale particulars before committing to buy. You’ll need to check all measurements, boundaries, searches and other details are correct – which is where a solicitor can come in handy!
Price guides. Remember that all properties at a house auction are offered at a guide price – and that’s precisely what it is – a guide! The guide price indicates the level where the bidding will start. Be aware, properties also often come with a reserve price – which is the minimum price the seller will accept for it. The reserve price may be higher than the guide price – but this figure is not disclosed to the buyer.
Legal packs. All properties at house auctions come with legal packs, which are available for you to view before you bid. It’s highly recommended that you view the legal pack and show it to your solicitor – paying particular attention to any special conditions of the sale.
Forms of bidding. Although many people enjoy attending property auctions, you can bid remotely if you prefer. There are a variety of ways you can do this. You can bid via telephone or by proxy – and some auction houses even let you bid online.
The Buy2Let Shop Limited
The Buy2Let Shop are a team of specialist property investment agents, and we offer investors assistance with buying a house at auction. If you’re looking for buy-to-let property for sale that generates a great return on investment, property auctions are often an excellent place to start looking – and we’re here to help with every stage of your purchase.
To find out more about buying a house at auction, or to attend one of our property investment seminars in London, simply visit The Buy2Let Shop website today.