Everything you need to know about buying a property at auction
PUBLISHED: 09:32 05 April 2019
Last year, 24,000 properties were sold at auction nationwide, but not everyone knows how simple this process can be. Bryan Baxter from Auction House East Anglia reveals all you need to know.
How does buying a property at auction work?
Buying a home at auction is very straightforward, says Bryan Baxter, director of Auction House East Anglia. “As a process it offers more certainty and transparency than traditional methods of buying a house, and we generally find that people who buy their house at auction can often go on to sell theirs at a later date by auction, too.”
Part of the ease of buying a house in this way is due to the amount of prior information available. Just like with a traditional house sale, potential buyers are encouraged to visit the property at regular open days, carry out pre-purchase enquiries and consult the legal pack, even pre auction surveys can be carried out.
Once the would-be buyer is satisfied with the information they have, they are free to bid on the property when it goes up for sale in the auction room. If successful, they will be expected to pay a deposit – usually 10pc of the sale price and an administration fee which will have been mentioned in the auction catalogue. The rest of the balance will be due on the completion date.
What happens if I am buying a house with a mortgage?
You don’t have to be a cash home-buyer to purchase a property at auction. In fact, more and more first-time buyers are attracted to properties for sale by auction. “This is largely due to the wide selection of properties on offer,” says Bryan.
These days, fewer properties to go under the hammer require significant modernisation, and house auctions are regarded as a more efficient way to buy a home.
What are the advantages to buying a house at auction?
“As long as you do your homework, buying a property at auction can offer you greater certainty,” says Bryan. “In some cases, it can also offer you the opportunity to get a real bargain and a much quicker house sale.”
From start to finish, it can take approximately two months to sell a property at auction – which means that lucky bidders can settle into their new homes much more quickly than if they had bought a house through a traditional estate agent.
I’ve seen a house I’m interested in. What should I do now?
The first step to buying a house through an auction is to do your homework. “Talk to the auctioneer,” advises Bryan, and seek professional advice on any legal queries you might have. Visiting the property during an open day is also advised.
“The other thing you need to do is to be prepared to set a limit,” says Bryan. Ask the auctioneer about administrative fees and be clear about whether or not there will be any hidden costs.
Knowing exactly what you are prepared to pay, and when, means that you won’t over-bid in the auction room, and that buying a house at auction will remain the simple and transparent process it should be – without any surprises.
If you would like more help and advice about buying a property at auction, including the steps to buying a house and further information about individual properties, contact Auction House East Anglia on 01603 505 100 or visit Auction House East Anglia.
This page is sponsored by Auction House East Anglia.