Property Auctions – A buyer's guide.
Buying a property at auction is becoming more and more popular. Over 3000 residential properties were sold across the UK in 2016 by auction and the figure is set to rise in 2017.
There are many reasons why an auction can be so appealing. It provides the potential chance to grab a bargain property at the right price. It provides certainty of success as contracts are exchanged at the moment the hammer strikes for the successful bidder, and also a completion date is fixed so the date of ownership is known to all involved.
The process of buying at auction seems ideal and full of benefits. However there can also be various pitfalls that a buyer needs to be aware of.
Before you enter an auction and place a bid on a property make sure you follow these tips to ensure that the process runs smoothly and without surprise.
- Attend the property and inspect it carefully. Is it as described in the auction catalogue?
- Research not only on the property but also the locality. Visit it more than once to check the surrounding areas and facilities.
- Instruct a SOLICITOR to review the auction pack fully. Have the auction bundle for the property explained to you clearly. The pack will evidence title to the property detailing any registered rights and obligations. It will advise what you may or may not do moving forward. The auction bundle will also contain property searches advising on the property and its connections. Finally the auction contract will advise on any additional obligations the seller is imposing with regard to hidden fees or payments.
- Work out your budget and ensure that you keep to it. Completion is typically 28 days after the hammer falls at the auction and the completion monies needs to be available without delay.
- Instruct a surveyor to attend the property. If this is costly, take a local builder to inspect and advise on any requirements. Forewarned is forearmed and the more information you have prior to the auction the more comfortable you will be bidding on the property.
If these straight forward 5 tips are followed it may cost you a few pounds prior to the auction but it will be money well spent and hopefully prevent sleepless nights worrying about issues that could have been avoided and cost more than expected to resolve.
Here at Lupton Fawcett LLP we have a team of professionals in the Residential Property departments in Leeds, York and Sheffield who would be pleased to advise on pre auction enquiries and hopefully give you the confidence to bid successfully on a property that is right for you.
We can also assist with the post auction formalities in completing the transaction and registering it at the Land Registry.
Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.