Property Auction Guide

Your new to auctions and fear of the unknown is a daunting prospect. That's why we have a compiled a step by step guide demystifying property auctions, what goes on there and what you should expect. The thing to remember is that auctions are just an alternative way of buying property - it’s as simple as that!

YOUR Step-by-Step Guide to Property Auctions

just an alternative way of buying property - it’s as simple as that! of buying property - it’s as simple as that!

STEP 1 SOURCE: Future auctions as far in advance as possible. Identify those property lots which suit your needs and interest you.

STEP 2 VIEWING: Call the Auction House to find out about viewing arrangements. The Auctioneer will either take a deposit for the keys and you will view unaccompanied. Organise for a local agent to show you around. Or arrange a group viewing.

STEP 3 FINANCES: Work out how much you can afford - your maximum price. Estimate your total costs including; repairs, decorations, solicitors fees, survey, mortgage, removal charges, furnishings and the like and add this to the amount that you will need to borrow. Remember that if your bid is successful you will
need to put down a 10% deposit immediately - you will need to make sure that you can cover this. Usually you will also be expected to complete within 28 days, for this reason you will need to have the a firm offer of a mortgage. Arrange this now - inform lenders that you intend to buy at auction.

STEP 4 LEGAL: Arrange legal assistance, either a solicitor or licensed conveyancer. Legal enquiries such as Local Authority and Land Registry searches need to be carried out before you bid. For a fee of around £10 Auction House's usually provide a 'legal pack'. This contains legal documents outlining special conditions of sale
and title deeds details. Now is the time to inform the Auction House of your serious interest in the property - they should keep you informed of any changes.

STEP 5 SURVEY: Lenders will require a survey to be carried out, to gauge a valuation. If you yourself are in the least bit dubious about a properties condition you should get a full survey.

STEP 6 BUY PRIOR TO AUCTION: If you desperately want a property and want to eliminate the risk of being outbid you can always submit an offer in advance of the auction. If the vendor likes your offer and thinks it to be fair they may accept.

STEP 7 VISIT AN AUCTION SALE: Before you go to an auction to buy visit an auction sale. See what happens, experience the atmosphere and get an understanding of proceedings.

STEP 8 PAYMENT TERMS: As soon as an auction sale finished and If you are successful bidder you will need to put down a 10% deposit there and then. You will need to know what types of payment the Auction House accepts. Some accept personal cheques and credit cards, with most of them welcoming bankers drafts
and building society cheques. Get the amount made out to 10% of your maximum price - if you are secure the property for less the auctioneer will refund you the difference.

STEP 9 CALL AHEAD: Before you set off for the sale call the Auctioneer to double check that your Lot is still going to be offered.

STEP 10 BE EARLY: This will enable you to get a seat, hear the auctioneers announcements and speak to a member of staff if you have any last minute queries. It will also give you time to register you interest to buy.

STEP 11 BIDDING: When your Lot's number comes up the Auctioneer will announce the address. At this point check it is the Lot that you have come to buy. When you registered your interest to buy you may have been given a card, you should wave this at the Auctioneer to make a bid. Otherwise use you hand or catalogue
to signal a definite intention to bid and catch the Auctioneers eye. If he receives a bid higher than your own he will return to you in case you wish to better it. He will also warn you when the bid is about to be closed, usually three times "for the first time, for the second time, for the third time and final time - sold!" Remember to stick to your maximum price - do not get carried away.

STEP 12 SUCCESS: Usually a property will have a reserve, if you meet it the Vendor is legally bound to sell to you. If your bid is the highest and the reserve has been met you are the winner. Now you will need to fill in a purchasers slip requiring details such as your, name, address, contact information and that of your solicitor.
Next comes the signing of the Memorandum of Sale, which you will exchange for the Vendors part as soon as it's ready - this is your contract and should be sent straight to your solicitor. You will also be asked for proof of ID and your 10% deposit.

STEP 13 INSURANCE: Once the gavel comes down the property becomes your responsibility. The Auction House or your solicitor should be able to advise you.

STEP 14 BALANCE OF PAYMENTS: Usually need to be transferred within 28 days of the auction. Then you can either move in, start renovations or sell the property onusually for a profit!!!