Buying at Auction - your tips/experiences gratefully received(2 Posts)
DH and I have been to look at a house that is up for auction in 2 weeks and we are very interested. Problem is our house isn't even on the market yet as we weren't actively looking to move....but this house is PERFECT for us (although in need of lots of TLC).
Does anyone have any advice on how we could possibly finance the purchase as we don't have 10's of thousands lying around in our bank account. Also, does anyone know anything about making an offer prior to the auction?
Basically ANY advice about purchasing at auction would be gratefully received.
In my experience, if you make a pre-auction offer before the sale, the agent simply rings everyone else who is interested and says "there's an offer of XXX in, what do you want to do?" and then someone can better it by a small amount. Perhaps ask the agent to keep you informed if there are pre-auction offers, or if it goes to sealed bids.
Personally I would be pretty wary of bidding at an auction if I didn't have every single penny of my finances already in place. In Australia (don't know how it is in the UK) you have to write a cheque for 10% when the hammer falls, and come up with the balance within four or six weeks (depending on the contract) or lose your deposit and potentially leave yourself open to further litigation from the seller (say if the market crashes in the meantime and they can no longer sell it for the price it reached at auction). I also wouldn't be tempted to skimp on getting the structural survey or the contract professionally reviewed. It's disappointing to have spent all that money if the bidding blows past your limit in seconds, but better than having bought somewhere that's going to lose its front garden to motorway widening or something.
If you do bid, don't sit there running up the bidding in small increments from the start. Jump in when the auctioneer is saying "going once, going twice..." and rival bidders will feel deflated, because you will appear fresh, cashed-up and just getting started whereas they're already wondering if they can make one more bid if they cash in their supermarket loyalty points. It should go without saying to set a limit and stick to it, but you do hear all the time of people getting carried away and overpaying.
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