Looking to purchase a property can be a daunting experience at any time. If you are looking to purchase a property at auction it can be like going to look at a property blindfolded. The property may be a bargain but always remember the phrase ‘Buyer Beware!’ Always obtain the auction catalogue as soon as it is available and do your research as the noted seller will have limited knowledge of the property and will not be able to provide you with any detailed information.
Before the date of the auction you should make sure that you have researched the location of the property and its surroundings (eg. any local landfill sites, rivers, train tracks, motorways), as they could have an adverse affect on the property. You may also wish to instruct a Homebuyers Survey if the building is fairly old and the appearance also evidences this. This will provide an in-depth valuation of the property and advise on any damp, subsidence, electrical and gas issues as well as any wear or tear that may be apparent. The cost of a survey may be approximately £500 but it would be money well spent to provide you with some peace of mind before committing yourself.
Before the day of auction. You need to ensure that you have a solicitor at the ready to check through the contract paperwork and ensure that all conditions are met. As well as your solicitor, if you are having a mortgage you will need to ensure that this has been agreed in principle to expedite matters. Searches should also be requested as soon as your offer has been accepted as the results can sometimes take up to 2 weeks to arrive. You will also need to arrange buildings insurance for the property as the building is now your responsibility.
Auction rooms can become very heated and it is not difficult to get carried away and over bid. You need to work out the maximum you are prepared to pay for the property and stick to it. Ensure that you read the addendum on the day of the auction as this will highlight any mistakes or changes that have occurred since the catalogue was first published. Watch out for unscrupulous bidders and accomplices that make fake bids toinflate the price being offered for the property so you need to ensure that your eyes and ears are peeled in the room!
For the uninitiated amongst you, your auction bid has been accepted once the hammer has gone down three times. At this point you are legally bound to purchase the property – in effect ‘exchange of contracts’ has taken place. Completion must take place within 28 days! Failure to complete within this time frame could amount to you being in breach of contract and you would therefore forfeit your deposit and additionally incur penalty costs and interest. A situation you do not want to find yourself in!
If you are looking to purchase at auction – we wish you luck! Remember the above points and you can’t go far wrong in getting the right property at the right price with the background of the property ultimately covered!
If you would like expert advice on buying at auction or conveyancing please contact me Dipika Mistry on 020 8899 7333 or email me at email@example.com.