Purchasing properties at auction, can be an exciting and yet daunting experience. It is extremely important to prepare thoroughly before any auction where you intend to bid on a property. We have collated the following 10 hints to help you prepare.
1. Do Your Research:
Research the property market in the area where you want to buy.
Attend several auctions as an observer to get a feel for the process.
2. Set a Budget:
Determine your maximum budget, including additional costs like auction fees and renovation expenses.
Stick to your budget to avoid overstretching financially.
3. Get Your Finances in Order:
Ensure you have financing in place before the auction.
If you need a mortgage, get pre-approved so you know your borrowing capacity.
4. Legal Preparations:
Instruct a solicitor or conveyancer to review legal documents and perform due diligence before the auction.
Obtain the auction pack, which contains important information about the property.
5. Property Inspection:
Arrange viewings and inspections of the property before the auction.
Consider getting a professional survey to identify potential issues.
6. Liaise with the auction house:
Many lots are at auction for a reason, speak with the auctioneers for information.
The guide price can change during the course of an auction, ensure to get up to date information on the legal pack and guide price prior to the auction.
7. Auction Day Preparation:
Arrive early on the auction day.
Bring your identification, proof of funds, and a method of payment for the deposit.
8. Bidding Strategy:
Decide on your bidding strategy, whether it’s bidding aggressively or waiting until later in the auction.
Stick to your predetermined limit.
9. Be Aware of the Costs:
Understand the additional costs involved, including auction fees, solicitor fees, stamp duty, and potential renovation expenses.
10. Post-Auction Procedures:
If you win the bid, you’ll typically need to pay a deposit immediately, often 10% of the purchase price.
Complete the purchase within the specified timeframe, typically 28 days.
Be prepared for the possibility of a property chain or other complications.
Remember that property auctions can be fast-paced and competitive, so it’s essential to be well-prepared and know your limits.
We believe it is very important to instruct a Lawyer who can review the legal pack and advise you prior to the auction on the legal aspects of the property.
At Insight Law we have a team of Lawyers who specialise in Auction properties. Contact us to discuss your specific requirements.
btl@insight-law.co.uk
02920 093600