You need to know how do property auctions work if you want to make sure you won’t make any mistake when it buying at a property auction.
How do property auctions work: the Prerequisites.
You need to have 10% deposit ready on the day of the auction, also you need to complete within 28 days. You need to be all set. Check out the guidelines for buy to let success
1. Do your research
Find out about upcoming auctions in your area and find out the best auction companies, established and respected.
2. View the property
Try to see the property a few times and only proceed if you’re really sure it’s what you want. Is it the right location, size, condition, type of property? Have a checklist and only proceed if it ticks all your boxes. Check out the guidelines to where to invest?
3. Talk to a mortgage adviser
Do your market research, speak with a few mortgage brokers and get an agreement in principle, so you can be sure you can afford the amount you’re bidding. You will need to have a valuation conducted before the day of the auction.
4. Make legal checks
Study the property particulars carefully, reading all of the small print. If you’re satisfied, send them to your conveyancer and ask them to carry out the usual searches, enquiries and title checks. a lot of the times, vendor`s solicitor will carry out the searches and send a copy to your solicitor.
5. Arrange a property survey
You should always have a survey done, auctions are a perfect place for a seller, who may be trying to offload a property with serious structural issues.
6. Decide on a price limit before you bid
Find out what other, similar properties in the same area have recently sold for. So, you can make an informed decision on how much you’re willing to pay. Being outbid may mean that you lose the money spent on the survey and solicitor, but that’s a small loss compared with paying thousands of pounds more than the house is really worth.
Bidding before the property auction
If you’ve found your ideal property and done the appropriate research, it’s not always necessary to wait until the auction to make an offer. However, early bidding can be a gamble because, if the auctioneer rejects your offer, you’ll have already shown your hand to them.
If you do manage to agree on a deal before the auction you’ll need to work extra fast. In fact, contracts must be exchanged several days before the auction.