How Do You Buy a House at Auction?

How Do You Buy a House at Auction?

In a vibrant housing market, both sellers and buyers may surprised to learn that auctions may be the route to adopt. Sellers may get more than they hoped for and buyers a bargain, but the latter should be aware that the property may be being auctioned because there are serious structural issues.

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If you are looking to buy at auction, it is vital that you do your homework and that the catalogue description of the property is accurate.

What Is a Property Auction?

Many auction houses engage in property auctions, where you can sell or buy a property in a competitive environment. Auctions can sometimes take the stress out of buying property, but go armed with a budget if you are buying. Also make sure you read the small print in the legal pack from the auctioneer, as some fees may be attached over and above the purchase price.

The vendor may set different limits on an auction. As a buyer, do not be lured in by the minimum reserve, since most properties will go for well above the minimum price set.

As in the stage of exchanging contracts in a traditional sale, you will be required to pay a 10% non-refundable deposit once the hammer goes down, so be prepared to have the cash ready. In online auctions 5% deposit may be payable over and above the purchase amount, but this buys a 28-day window before exchange of contracts. This is often referred to as a reservation fee.

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The Importance of a Survey

You are purchasing “as seen” at an auction, and not only should you view the property before attending the auction, but it is vital to have a survey. If you are looking at property in North London or the Home Counties and want to carry out a home buyers survey Watford is a good place to find a professional surveyor. When it comes to a home buyers survey Watford is a good place to start.

Too many buyers get carried away at auctions, and it is important that you have a professional survey to hand before you decide to proceed with a purchase.

There are other tips for buying at auction such as sticking to your budget, understanding that once you have completed a purchase you are tied by the terms and conditions of the event and having your deposit ready to pay.