Benefits of buying property at auction

Cheap houses for sale

There are many advantages to buying property at auction and it is by familiarising yourself with them that the attraction of the auction process will become clear.

The price is right

Auctions really do offer the chance of securing a property at a bargain price and you will no doubt bid for a specific property because it is right for you and you will want it for a specific purpose.

Speed

The process of buying property at auction is quick and easy, a main attraction for prospective bargain hunters. There is a fixed timescale from the outset. The auction date is set and the period from then to completion is usually 28 days (20 working days) or otherwise stated in the special conditions of sale.

No fixed asking price

If you are the highest bidder, you could win the property at a lower price than you may possibly be prepared to bid up to, and by doing so, will purchase at less than would have been the case by tender or invited offer.

No gazumping

Once the hammer falls, this is a legally binding contract and the vendor has sold it to you – they cannot continue marketing the property and see if they get a better offer in the meantime.

No hidden surprises

UK auction houses should make available all necessary legal and tenancy documentation from searches and leases through to planning permissions and scheme layouts for development plans. They should all be easily accessible, and are often downloadable from their websites. Ensure you familiarise yourself with the legal pack in advance and ask your solicitor to explain anything that you might be unsure of. 

Level playing field

You have as much of a chance of being successful with your bid as any of the other bidders in the room. Most properties entered into auction are sold under the hammer on the day (although sometimes pre-auction offers are accepted by the vendor). Remember not to be tempted to exceed your budget.

Tenancy income

The purchase of a tenanted property will guarantee you a rental income from the day of legal completion. You benefit from the investment from the moment of ownership and as a result makes any finance repayments easier. The legal benefits of the tenancy agreement/lease are transferred along with any responsibilities it contains.

Temporary financing

Short-term lending facilities are usually available, which will allow you to complete on the property with temporary funding, prior to your preferred long-term mortgage being confirmed. UK Auction List’s finance partner, John Charcol can help you to arrange this, if required.