In our last property development article we had a look at our Director, Clare Viner, and the beginning of her journey of climbing the property investment ladder. In this follow up piece we look at the keys elements of selling and buying at auction.
Four months into listing her first property on the market there were no offers. The decision was made to try Plan B; putting the property in an auction.
In most cases buyers can get a good bargain at auction, and it almost always guarantees a quick sale. Once that gavel hits the buyer is in a legally binding position, and must complete the purchase within 28 days. The question is whether it really the best option for the seller?
Clare evaluated the auction process before making a formal commitment. The following questions, were asked and should be asked:
- What is the minimum it needs to achieve?
- How much will it save vs paying the mortgage costs for X amount of time whilst a suitable buyer was found more ‘conventionally’?
- What is the difference between auction fees and estate agent fees?
After weighing up the pros and cons , she decided to go ahead and list the property at auction.
For anyone looking to purchase in an auction, you can get a great bargain, but make sure you follow the below tips to ensure you are well prepared.
Make sure you have a mortgage offer lined up in advance, as you will only have 28 days to hand over the balance.
Make sure you have the required 10% deposit (in cleared funds), ready to hand over on the day of the auction.
Make sure you read, and re-read the legal pack. Many an inexperienced buyer has been caught out by particulars in this.
Get a survey done beforehand, which may show up structural issues that would stop you from buying the property. The initial outlay may be a few hundred, but it could save you from wasting thousands on building work.
Have a solicitor or conveyancer lined up and ready to go.
Contact us today to discuss your mortgage options:
Please note this article is not intended as advice in any way, and should not be construed as such.
*Your House may be repossessed if you do not keep up with your mortgage repayments*