A guide to buying property at auction

When you exchange on the purchase of a property at an auction, you are entering a legally binding contract to buy that property at that moment. So you must have your finances in place (usually 10%), have had your surveys and inspections done BEFORE the auction, and be ready to complete the purchase (usually 28 days from the auction date). This restricts some buyers who cannot be sure that they have all funding in place within the very strict timescale required. Remember you are committed to the deal when the hammer falls! You cannot find problems after and then look to get out of the deal. So be sure you are happy with the condition of the property before bidding. Also it can be very easy to get carried away with the excitement of an auction and bid more than you planned to, so set a budget and stick to it!

Selling at an auction, the main advantage is certainty of sale. You know on the fall of the hammer the buyer has to pay a non returnable deposit and sign a binding legal contract that they will complete the purchase in the 28 day period set out in the contract. The downside is you may not achieve the figure you were looking for (you may wish to set a reserve prior to the auction).

Auctions are exciting! The adrenaline rush when your lot is called up is a great experience whether buying or selling. Have you got a ‘real bargain’? Has it been ‘knocked’ down for less than you were prepared to bid up to? As a seller have you got more than your predetermined “reserve price”?

They can be disappointing too. As a buyer you did all your homework, arranged your finance, had your inspections/ surveys done only to be out bid on the day. Or as a seller you have spent a couple of months marketing your house prior to the auction only to see it not reach your reserve price.

There are pros and cons to auctioning your property. Auctions can be a compromise, but they are an option! They do have their place for the right client with the right property.

Whether you are buying or selling we at G M Wilson Solicitors can give you all the advice and assistance you need. Please call one of our solicitors on 01924 291111 (Wakefield) or 01226 794140 (Barnsley) or visit the Conveyancing Services or Enquiries page of our site.