Buying Houses at Auction

One of the most expensive residential properties to be offered at auction is to be auctioned next month. A block of flats in London is expected to make more than £11million. It’s a very large price tag, but what’s really interesting is that the seller has chosen to sell at auction rather than using an estate agent.
Buying houses at auction is becoming more and more popular with private purchasers. Traditionally only developers and property professionals would buy at auction.
There are many advantages to purchasing at auction rather than in a traditional sale. When the hammer falls and yours is the highest bid, the property is yours. At this stage, it is not possible for anybody else to offer a higher price or outbid you; there is security in the transaction for both the buyer and seller. Buying houses at auction also means that the whole process is completely open.
Between 2009 and 2013, the average residential house sold at auction, increased from £156,000 to £216,000. The biggest growth has been in people their mid to late 50’s who are looking to buy their final purchase at auction. Generally, the property will be in need of substantial work and will not sell easily through traditional marketing.
When buying houses at auction visit the property as many times as possible looking for signs of impending disaster like dry rot, subsidence and any potential rights of way or neighbour disputes. It’s a good idea to get a local builder to look round also, pointing out any work that might need to be done. Normally, when the hammer goes down, you are legally bound to buy the property, contracts will be exchanged and a 10 per cent deposit must be paid.
The balance is generally payable within 28 days of the sale, unless you make other arrangements with the vendor/auction house before the sale. It is vitally important that you have the means to settle, on the terms you agree, and this is where secured lenders such as Atpledge can help you buy houses at auction. This is usually a temporary measure so you have the funds in place, enabling you to choose your mortgage provider at leisure.
Most auction houses will accept phone bidding, postal bidding (with the requisite 10 per cent deposit cheque enclosed) and online bidding from anywhere in the world. All auction houses will state a guide price, which, generally speaking, is the reserve price for the property.

If you thinking of buying a house at auction and need to raise cash call Atpledge on 0800 810 1111. We are auction loan specialists.