Buying a property at auction is becoming increasingly popular because of the shortage of homes for sale on the open market combined with the far faster completion process that auction property offers.
Making A Bid On Property At Auction
Before You Make A Bid
Before you place a bid on property for sale at auction, make sure you research the property in advance first. Enlist a solicitor to review the sale pack before the date of the auction – this should contain the property’s title deeds and recent searches.
It’s vital you understand the property you’re potentially going to buy at auction.
Although being thorough means spending money on a house you might not buy, you will know which questions to ask at the start of the auction before the bidding starts, as your solicitor will give you a report highlighting any areas of concern.
You should also arrange a suitable survey so that you are aware of any defects in the dwelling/building and the costs of rectifying them.
Your Bid Is Accepted
If your bid is accepted, you are legally committed to making the purchase.
The contracts are exchanged at the auction and a completion date is set, often 28 days after the auction day.
You cannot raise any queries after the sale is agreed and contracts exchanged – this is why it’s worth the cost of a solicitor prior to the auction date, to ensure you don’t receive any unexpected news or costs related to the property at a later date.
Your solicitor will then deal with the completion process, transferring legal ownership of the property to you and making arrangements for any stamp duty to be paid to the H M Revenue and Customs.
Paying For Property At Auction
You will have to pay a 10% deposit on the day of the auction, if your bid is successful, so it’s vital to ensure you have the necessary funds cleared in your bank account before the auction date.
Furthermore, as you’re legally committed to buy the property if your bid is accepted and completion is far quicker than for a standard home purchase, you must have sorted funding in advance. There will be no time to sort a normal mortgage between the auction and completion dates.
Is It A Good Idea To Sell Your Property At Auction?
The advantages of selling your property at auction include a fast turnaround time – if you need to sell the property quickly for whatever reason, an auction sale will offer a far faster completion time than a normal house sale.
The downside to selling at auction is that you could end up accepting a lower offer than you might have done if you sold the property on the open market.
How We Can Help You With Your Auction Property Purchase
Our solicitors have the specialist legal knowledge and experience of helping clients to buy and sell property at auction – and are here to help you if you’d like to find out more about the process or to instruct a solicitor to review a sale pack.
To speak to us about buying or selling property at auction, please contact us on 01244 311 633 or email advice@bartletts.co.uk
Alternatively, you can Make An Online Enquiry and one of our team will be in touch with you as soon as possible.
