How to Buy a Property at Auction

Before an auction

• Attend an auction beforehand to get a feel of what really happens
• Register with the auctioneer and subscribe to the catalogue mailing list
• Arrange to view any properties that you are potentially interested in, instructions on how to do this should be listed within the catalogue
• Research the property and area thoroughly making sure you are aware of market value and rental comparisons via agents and websites
• Check with The Money Centre online buy to let mortgage quotation system to check whether the expected rental is sufficient to cover the mortgage payment
• View the property
• If a property is in need of renovation we strongly recommend that you ask a reputable builder to view the property with you and ask them to quote on putting the property back to an 'as new' condition
• Involve your solicitor as soon as possible, they will be able to go through the legal pack for you and inspect the necessary documents
• To avoid disappointment it's always best to have a selection of properties to bid on as this helps you to avoid getting sucked into the emotion of the auction and prevent you from paying over the odds
• One of the most important tips we can give you is DON'T take shortcuts, all properties are sold as seen and you can't back out if you subsequently find something out that you don't like about it.

On the day

• Take two forms of identification with you on the day, along with the ability to pay the deposit. Most auctioneers accept bankers' draft, personal or building society cheque but it is always worth checking beforehand
• On arrival check whether you need to register in order to bid
• If you haven't already been able to access a legal pack this should be available for you to view on the day
• Don't get carried away. Set a price limit you are prepared to pay and stick to it!
• Be aware that on the drop of the hammer you are legally bound to purchase the property
• You are responsible for the property as soon as you've exchanged to buy at auction so you will need to insure the property. Click here for a comprehensive quote from our recommended supplier
• If the property fails to meet its reserve price don't give up. Speak with the auctioneer afterwards to register your interest and offer your maximum bid. The seller may well accept.

If you are already buying at auction you will probably be very frustrated with criteria that prevents you from refinancing within 6 months. This has significantly slowed down the ability to take advantage of current market conditions but the option of bridging finance could help provide you with an alternative solution.

Buying at auction can offer some great investment opportunities but it shouldn't be taken lightly, our intention is not to put you off but to ensure you are fully informed and have realistic expectations. Expect to spend a full week of your time to find each property that you end up buying. If this saves you £20,000 to £30,000 it's a week well spent. Another helpful tip is to not give up, a deal is like a bus, you can wait for ages and then three turn up all at once!

To find out more or to discuss your auction funding requirements with our recommended supplier make sure you contact us today.