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Vinny09

Auctions - Cheaper Or Not?

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Hi,

It looks like auctions are getting to be more popular and I was surprised to see that Zoopla are even getting in on the action now - claiming almost a million visitors to their auctions section and 8,000 unique bidders (source: http://www.makeoffer.co.uk/blog/2011/02/01/interview-with-mark-witherspoon-strategic-development-director-at-zoopla-co-uk/ )

However, looking at it from the perspective of a potential buyer, does it work out cheaper to buy at auction or do you end up paying the same / more for potentially dodgy properties? Anyone got any useful figures?

I have to admit to being a bit scared about the prospect of going to a property auction in case I get carried away!!!!

Any advice / figures much appreciated!

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Hi,

It looks like auctions are getting to be more popular and I was surprised to see that Zoopla are even getting in on the action now - claiming almost a million visitors to their auctions section and 8,000 unique bidders (source: http://www.makeoffer...t-zoopla-co-uk/ )

However, looking at it from the perspective of a potential buyer, does it work out cheaper to buy at auction or do you end up paying the same / more for potentially dodgy properties? Anyone got any useful figures?

I have to admit to being a bit scared about the prospect of going to a property auction in case I get carried away!!!!

Any advice / figures much appreciated!

Homes Under The Hammer has a lot to answer for in terms of presenting auctions as the road to riches. Credit to them though for showing people who make a loss.

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I spent a lot of time looking into and finding out about auctions. It does seem that bargains can be picked up but I have never bought at auction and doubt that I ever will.

I would always want a survey carried out first on anything that I was to bid on and would indeed require one to secure a mortgage. It could end up quite expensive paying out for full surveys on places that end up going above my ceiling. If you go to an auction with two or three possibilities then it could be expensive.

The 10% deposit has to be available on the day along with the auctioneers fees.

Also, the places that seem to go to auction are rarely the family homes that many of us are looking at from what I have seen. There hasnt been many places that I would want to live in gone through the auctions that I have watched. They all seem to be btl sh1tboxes or repos or in need of a hard hat type renovation.

Seems to me that auctions are best for cash buyers and btl landlords or builders, not much good for the average joe.

That said, I am very interested to know others experiences and especially from those that have actually bought at an auction.

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I spent a lot of time looking into and finding out about auctions. It does seem that bargains can be picked up but I have never bought at auction and doubt that I ever will.

I would always want a survey carried out first on anything that I was to bid on and would indeed require one to secure a mortgage. It could end up quite expensive paying out for full surveys on places that end up going above my ceiling. If you go to an auction with two or three possibilities then it could be expensive.

The 10% deposit has to be available on the day along with the auctioneers fees.

Also, the places that seem to go to auction are rarely the family homes that many of us are looking at from what I have seen. There hasnt been many places that I would want to live in gone through the auctions that I have watched. They all seem to be btl sh1tboxes or repos or in need of a hard hat type renovation.

Seems to me that auctions are best for cash buyers and btl landlords or builders, not much good for the average joe.

That said, I am very interested to know others experiences and especially from those that have actually bought at an auction.

So is there no general pre-auction survey done on the properties? Is it always up to the buyer to get this done?

Surely there must be some grace period whereby if you buy at auction and the survey turns up a stinker you can back out?

Sorry for a million questions, just interested to know how it works. Many of the websites seem to have their own "steer" on it due to vested interest.

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So is there no general pre-auction survey done on the properties? Is it always up to the buyer to get this done?

Surely there must be some grace period whereby if you buy at auction and the survey turns up a stinker you can back out?

Sorry for a million questions, just interested to know how it works. Many of the websites seem to have their own "steer" on it due to vested interest.

No. You bid and win you buy.

Or lose your deposit.

Not for anyone who really needs a mortgage yet though.

Speedy solicitor is the key and one who will look through the auction pack BEFORE the event so it can be done quickly after.

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So is there no general pre-auction survey done on the properties? Is it always up to the buyer to get this done?

YEs indeed.

Surely there must be some grace period whereby if you buy at auction and the survey turns up a stinker you can back out?

NO - once the hammer goes down you are committed. Usually then to handover 10% on the day, and complete the deal through your solicitor in the next 28 days.

Prior to the auction the seller has to compile a package of information with searches and other legal information on the property, rights of way etc in it, but there is no survey at all. That is down to the buyer. Caveat emptor.

Sorry for a million questions, just interested to know how it works. Many of the websites seem to have their own "steer" on it due to vested interest.

Edited by chrismar

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So is there no general pre-auction survey done on the properties? Is it always up to the buyer to get this done?

Surely there must be some grace period whereby if you buy at auction and the survey turns up a stinker you can back out?

Sorry for a million questions, just interested to know how it works. Many of the websites seem to have their own "steer" on it due to vested interest.

Nope, the auction house has nothing to do with the houses, they just sell them.

You win the bid and you buy. You pay the 10% deposit on the day and then you have normally 30 days to complete (I think 30). You dont complete and you lose the deposit. You turn up anything nasty that you didnt know about because you didnt have a survey or only got a cheap one and the problem is all yours.

Not for the faint hearted and as sarah says time is tight, especially if you have to get a mortgage pushed through. Thats why I said it suits cash buyers.

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Last year, my daughter wanted to buy a house that was up for auction. Before the auction, they accepted her offer of 147k.

She then had the house surveyed and it was found to have a major structural fault. Floors were sinking and it was in an area riddled with ancient, uncharted coal mines. She pulled out.

Out of interest, I went to the auction. A bidder won the auction at 120k. I knew that they had not had a survey done, so they were probably cash buyers.

Three months later, I went past the house, in the garden was a heap of gravel the size of a medium garage, clearly they were having repairs done. Privately, the surveyor had said that without digging up all of the concrete floors, he could not even give an opinion, but reckoned that 50k might just pay for the repairs.

So, be warned, those bargains are at auction for a reason.

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So is there no general pre-auction survey done on the properties? Is it always up to the buyer to get this done?

Surely there must be some grace period whereby if you buy at auction and the survey turns up a stinker you can back out?

Sorry for a million questions, just interested to know how it works. Many of the websites seem to have their own "steer" on it due to vested interest.

If you are very interested in a property then you can usually pay to have the searches done, and a survey, and get a mortgage offer ready before going to auction. But then it's wasted money if you end up being out-bidded on the day.

As has been mentioned above, few nice "ready to move in" family homes appear at auction and if you want to buy a property to do up then you will not be able to compete with a builder, who will be able to do the work for at least half of what it will cost you.

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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