There is an large number of people who have brought property at auction. Thousands are brought through auction each year and there are a number of advantages for doing so.
Advantages of Buying a Property through Auction
1. You may get a serious bargain!
2. The whole house buying process would be quicker - you could make the move to your new property sooner!
3. No worry about "gazumping" - someone else making a last minute higher offer after yours was initially accepted
At a Property Auction
When it comes to property auctions, auctions houses will publicly release a "Catalogue" of the properties about a month prior to the auction date. If you are interested in going to an Auction, you should get yourself an auction catalogue so you can view and review the properties on offer.
If you like one of the properties or are interested in one, you should arrange a viewing as soon as possible. Doing this, you will know the facts about the property before the auction date, and it will help you know how much you want to bid.
Guide Price - what the auction house/seller think the property is worth
Reserve Price - the minimum price the seller will accept (usually kept confidential)
You should have a thorough look through the "Legal Packs" for the properties you are interested in. These will be available and are prepared by the seller's solicitor. These will tell you if the property is involved in any disputes, or whether there are any potential developments being built or planned nearby, etc.
You should also consider if you want to have a survey completed on the property (highly recommended). You are making a huge investment so you should ensure that you are aware of all of the implications before you enter into it. Again, you should have your survey completed prior to the auction because as soon as you bid at the auction and you win, you immediately become the legal owner of the property.
Arranging a Mortgage
If your bid has successfully been accepted...congratulations! You will have a set number of days in which you must exchange contracts, and complete. At this point you may require to finance the property with a mortgage, and arrange for insurance.
At Bright Sun we have experience of helping clients arrange for a mortgage on a property purchased from auction. So if you are thinking about going or have been and have had a bid accepted, why not speak to us if your require a mortgage to finance your new purchase.