The Dos and Don’ts of Buying at Auction
Purchasing a property by auction, whether for the first time or the hundredth, should be simple, straightforward and hassle-free. Of course, as easy as auction sales are designed to be, that doesn’t stop the act of purchasing a property from being a very important decision, and one that should never be taken lightly, regardless of the lot’s type, size, condition or location.
To help you remain confident and informed throughout the process of buying by auction, we’ve put together this useful set of dos and don’ts so that you can fully prepare. Written by our friendly and experienced auctioneers who’ve seen it all, steer yourself in the right direction and avoid the common mistakes made by first-time auction goers by following our advice.
Dos of buying property by auction
Let’s start with the basics of what you should do when buying at auction – starting from the very beginning. After all, much of what you see on the day of the auction itself (or in our online Timed Auctions), is the culmination of months of preparation, both on our part as auctioneers, and yours as a prospective bidder.
DO: Your research
This may go without saying, but if you’re considering buying a property by auction your first task is to do your research. Firstly, we’d recommend putting careful consideration into what you want to buy, and where you want to buy it. To do this, you’ll need to think about what you want in your property by asking the following questions:
- Are you purchasing a property to live in yourself? If it’s for you, you’ll know best which amenities are essential for your needs and you can narrow your search that way. Make use of handy websites such as HM Land Registry for past sold prices, Police.UK to see local crime maps and Extrium for information about air and noise pollution.
- Are you looking for an investment property? If so, you may want to look at locations with high buy-to-let yields. We research this annually and publish our own findings in our Rental Yield Map blog to help investors turn over the most profit.
Regardless of your buyer position, we would also recommend that you support your house-hunting research by signing up for our newsletter to receive email updates throughout the year, and get notified when our newest auction catalogues are released. This will ensure you remain informed of any lots being sold in our upcoming Auction Events that may be of interest to you.
DO: View the property and ask questions
While some prospective buyers are certain a property is right for them from an online listing alone, we always recommend reaching out to arrange a viewing before bidding. This gives you the opportunity to ask any questions and get a full impression of the place so that you can approach the auction with confidence that the property is the one for you. This is especially important for auctions as, unlike purchasing on the open market, your offers (or bids in this case) are contractually binding.
If you’re interested in a property listed on our site, viewings can be arranged by clicking the ‘Request Viewing’ button on the property page. We always try to offer physical viewings, but there are some instances where these are not possible, including:
- If you’re considering purchasing a piece of land, you can visit the site at your own convenience without the need to advise us beforehand.
- Where access to the property isn’t available, such as it being currently tenanted or in an unsafe condition, we offer virtual tours in the place of physical viewings.
More information on how we conduct viewings for potential buyers can be found in our full Guide to Property Viewings.
DO: Read the legal pack
An absolute essential for anyone considering bidding on an auction property, you should always download and read the legal pack associated with your property of interest. This contains all legal information relating to the sale, including any related fees, whether it’s being sold as conditional or unconditional, and (in some cases) information from supporting searches performed on the lot. To learn more about these and why they’re important, read our full Guide to Auction Legal Packs.
DO: Set a budget
It’s important to set a budget before you start bidding. This is because, when bidding under auction conditions, the highest bid is accepted and made binding when the gavel falls. As such, you should know in advance exactly how high you’re willing to go so as to not get swept up in the excitement. When devising your budget, make sure it’s informed by both market research and takes into account any refurbishment costs you plan on spending.
DO: Get your finances in place
Once you’ve set your budget, you should sort out how you’re going to pay for your new property. Things move quickly in the world of property auctions, and completion of the sale can be as little as 30 days after the bid is accepted, so it’s best practice to have the finance in place prior to bidding. This can be done in one of two ways:
- As a cash buyer. Cash buyers should have their deposit and buyer fees available for transfer at the end of the auction, while the rest of their payment will need to be made before the end of the completion period. The relevant time scales for any given purchase will be visible in that property’s legal pack.
- As a mortgage/loan buyer. If you’re in need of financial assistance through a short-term loan provider or mortgage lender, you should seek to get this in place prior to bidding. More information about how to secure funds can be found on our Auction Finance page.
DO: Apply to bid in plenty time
If you’ve completed the above tasks, and found an auction property you’re interested in bidding for, we recommend registering to bid as soon as possible. This is because, as we perform the necessary identity checks on all bidders, we require all bidders to complete our registration form by 5pm the day before the auction. Registering early also allows you to get your plans in place as, for our Auction Events, we have additional options for bidders who can’t watch the auction unfold live. We’ve developed separate guides for each of these options, all of which can be found below:
Don’ts of buying property by auction
While we’re always the first to assure our bidders that purchasing a property by auction is a simple process, it can be easy to be led astray by common misconceptions. To make sure you avoid the potential pitfalls, follow our advice on what not to do in the run up to, and during, a property auction.
DON’T: Be put off by renovation work
While our auctions feature plenty of properties that are move-in ready, and with new builds with all the trimmings regularly brought to us by sellers, we also see a wide range of properties perfect for renovation. Contrary to what you may expect, however, these properties do not all need lots of work, and ‘renovation’ properties shouldn’t be discounted from your consideration on title alone.
Instead, if a lot is of interest to you, we recommend viewing it in person to gauge how much work would be required to bring it to your standard. After all, in many cases these properties only need cosmetic decoration, rather than full re-working, and the potential for getting it for a lower price to reflect the work needed is an attractive prospect to many buyers.
DON’T: Worry about bidding
Property auctions can appear more intimidating in theory than practice, but we promise that if you’re viewing or participating in an auction for the first time, you need not be worried. Rather than being a very tense experience, our property auctions are fun, exciting and accessible.
If you’re concerned about taking part in an upcoming auction, and would like to feel more prepared, we recommend viewing an auction prior to the one you wish to bid. This way you can get a feel for the flow of the event, and gain a better understanding of what to expect when your turn comes.
If you end up feeling too overwhelmed by the prospect of bidding, don’t worry, we have additional support in place to make sure you don’t miss out. By registering for a proxy bid, for example, you can detail your top bid prior to the auction, and our auctioneer will bid incrementally on your behalf. Alternatively, our Timed Auctions are ideal for anxious bidders, as bids are accepted 24/7 online and end at a predetermined time without an auctioneer present. Read more about these on our Timed Auctions page.
DON’T: Forget the quick timescales
If you’ve only ever purchased property on the open market, you may be unfamiliar with just how quickly auctions and post-auction contract exchanges can go. As such, it’s important to familiarise yourself with the terms and conditions of your purchase before bidding so that you don’t fall into the trap of leaving things too late. This is because, if you don’t have your full finances in place by completion date, you could be charged interest on the purchase or even sued by the owner. These cases are few and far between, however, and if you’re concerned about the quick turnaround time, you may want to consider only bidding on conditional properties which have an additional reservation period (usually of 30 days). Visit our Guide to Conditional and Unconditional Auctions to learn more about both options.
DON’T: Purchase without solicitor advice
No buyer should seek to bid for a property without first consulting a solicitor. They’re experts in their fields, and can be relied upon to provide informed, impartial advice regarding the property you’re interested in. This is why we recommend asking them to review the auction legal pack in advance of bidding. That way you can ensure anything which you may not be happy with is picked up prior to committing to the sale.
DON’T: Assume auctions are only for investors
Anyone can buy at auction; it’s not simply a domain for property professionals or investors. We welcome buyers of all backgrounds to our auctions, from families looking to move home and first-time buyers taking the step onto the property ladder, to couples wanting a renovation project and businesses looking to occupy new premises. If the property is right for you and your budget fits, then make a bid!
Start your property auction search
Whether you’re joining us as a developer, investor, property flipper or residential buyer, our diverse property auctions have something to suit your needs. Start your search online by browsing through our Property Finder, or narrow your search by auction type by looking at our Auction Events, Timed Auctions and Buy it Now.
Buying a property by auction… that was easy.