At an auction, the process of a property transaction between buyer and seller is reduced from months to minutes – which can be beneficial to both purchaser and vendor – but when the gavel falls a binding contract is concluded – and the buyer is committed to paying a non-refundable deposit. At SO Legal, we specialise in Auction Sales and Purchases and regularly have stands at Auction Houses to assist you with the process.
Whilst there can be real bargains to be had, property is often sold at auctions because it’s in a poor condition or there are issues with the legal titles – so what initially looks like a giveaway can sometimes turn out to be anything but.
Prudent buyers will therefore have done their homework, appointed an experienced property solicitor and carried out all relevant checks and enquiries in advance.
SO Legal’s Auction Sales and Purchases Team has acted for numerous clients on auction property transactions and here’s a few pointers that we recommend to anyone considering buying a property this way:
- If you’ve never bought property at an auction before, we’d recommend attending an auction to observe proceedings and get a feel for the whole process.
- Have a good read of the legal pack for each property you’re considering. Legal packs are put together by the vendor’s solicitor, providing you with copies of the Title Deeds, Special Conditions of Sale, Land Registry Search, Leases (if applicable) and any other relevant documentation. A good solicitor will be able to advise you on anything of significance or concern.
- Get a pre-auction conveyancing report and carry out a full survey of the property in advance of the auction. It’s worth the expense, even if you don’t end up securing the property.
- Research the value of similar properties on the market in the same area. Hold your nerve, decide what you can afford to spend and keep to your budget.
- Have your finances ready including 10% in cleared funds to pay on the auction day. Once you’ve paid the deposit, you will have a maximum of 4 weeks to pay the remaining balance, so ensure you have an agreement in principle if you need a mortgage.
- If it’s a commercial property, check your liability to pay VAT on the purchase.
- If there are currently tenants in the property, ask your solicitor to check the status and duration of the tenancy.
There are no guarantees when buying via an auction. If problems arise after the purchase, you will have very little chance of riposte against the vendor, so you’ll need the support of an experienced property lawyer and conveyancer by your side, with speed of service to match.
Call James Halpin today for a no obligation auction estimate and assistance with your purchase:
01323 407555 / 01273 066920