Has anyone bought a house at auction?

[marykat2004]

Hi, I'm looking to move and saw something interesting listed on an auction email.

I just wonder if anyone has done this and how it works and if it's good or not. A friend said to stay clear because "amateurs drive prices up" but I just wonder if anyone here has any experience? I'm thinking about having a look just to see what the place is like. It is under budget for the area but I wonder if that is just the starting bid.

Thanks

You have nothing to lose by looking but you need cash to buy at auction. Mortgages are difficult to sort in the given timescales.

We looked at an auction property today and there was a possibility of making an offer before auction so have a viewing and ask if this is an option

I believe that once you win at auction, it's yours, so you need to do the survey & everything before. Watch a few episodes of Homes Under The Hammer on iPlayer. It gives some tips & info that might be helpful. I expect the BBC would also have a website area for the show too.

I've bought four properties at auction. Generally the guide prices are very low to reel the buyers in - on the last one I went to, a flat that was guided at #140k had an opening bid of #250k and sold at #350 and something... There are bargains to be had and sometimes public bodies sell at auction to show that they got "the highest price on the day" rather than risk accusations of back room deals through dodgy estate agents but often properties are sold at auction because there is a problem that makes them undesirable and even unmortgageable so watch out.

HUTH is a good place to start - they will give you an idea of some of the problems that might come up (although I have no idea how the buyers do the work they do for the prices they claim...).

Survey first if you're serious. And ime they go for x 3 of guide price... but you can be lucky.

We have done this and survived so it is possible.

I think the guide price/achieved price can vary enormously depending on where you are and who the auctioneer is. If you can, get hold of the results for the auctioneer's previous few auctions and see what you can work out. In our case, we could see that most of the properties went for pretty much bang on the guide price, so it was worth trying. And in fact we bought ours for exactly in the middle of the guide price range (£250-300k and we got it for £270).

A full survey isn't always the most useful thing, as someone said to us, quite a lot of what surveyors will tell you is just what they can't see. We - rather scarily - didn't have one, but went round with an architect who specialised in old property. She then told us what she thought the problems might be, and we took a trusted builder round to advise us on those (flat roof, some cracks in one wall). We've only discovered one horror since then, and that was something a surveyor would never have spotted as it was hidden behind a stud wall.

Re the making an offer, we loved the property so much that we wanted to do this, but the seller said no. In fact, we bought it for less than we would have offered, so we were very glad we didn't in the end.

But we did have the cash available to do it - we will only need a loan to fund some of the renovations.

I have not done this but just be aware that once you make a bid at an auction and it is accepted, then that's a legally binding offer and you can't get out of it. So you need to be very very sure about the house before you bid.

(apologies if you know all this, but I've heard lots of misconceptions about auctions)

I went to see the house today. Inside it is a wreck but outside looks ok structurally. There were about 20 people viewing. It's a vacant possession and it looked like who ever was there before left in a hurry (eggs dated 20 Sept in the kitchen, newspapers from August, beds still there, and lots of stuff still there really.).

I met another guy who is also new to looking at houses, including auctions, and we decided to go to the auction next week as observers. We had been told that it's best to watch an auction before going to one to bid.

I LOVED the size of this house, and it's right near some friends with kids that my DD plays with. But the auctioneer seemed to hint the going price might be higher than what I've got. And I don't have the cash yet, until my flat sells. But still, it will be an interesting experience to watch the auction.

I thought the price was low for the area, even with the house in a bad state. It's listed as £195,000 for a guide price. Houses usually got £300,000 around there, £250,000 if in need of work.