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Buyer's FAQ's
Property Auction - Buyer's Questions Answered
Before the Auction
Yes, it is possible. You will need to register for each and every auction lot you are interested in bidding on. Registering on one auction lot does not automatically mean you are authorised to bid on other lots.
As you register for each lot, a bidder security will need to be authorised. You will, therefore, need to have a bidder security of £5,000 for each and every lot you are looking to bid on. No monies will actually be deducted from your bank account – it will just be a hold on your funds.
Yes, as Auction Agent will have to verify and authorise your details for each auction lot you wish to bid on.
There are no fees to bid, it is free. If you are the winning bidder you will pay a 10% deposit (which will be taken off the balance of your purchase price) as well as the buyer’s fee.
The bidding start and end time will be clearly displayed in the “Bid Now” widget on each auction lot.
All auction lots that start on the same day will start at the same time, however, their auction end time will differ.
Yes, although all auction lots start at the same time, they end at different times. You will, therefore, have sufficient time to bid on multiple lots without any issues.
Yes, Auction Agent is open from 09:00 to 17:00 Monday to Friday. You may contact a member of the auction team by phoning 01706 940499 or by emailing info@auctionagent.co.uk.
It is not compulsory for you to get legal packs checked. It is, however, advisable to get them checked if you are new to the bidding process or to the property industry.
After the Auction
The bidding is live on the system and your latest bid is shown. If you are the highest bidder when the auction finishes and the lot has met reserve, you are the winning bidder.
Yes, you may. Please contact Auction Agent at 01706 940499 or email info@auctionagent.co.uk if you wish to make a post-auction offer and we will be happy to explain the next steps.
It is typically stipulated in the sales contract that buyers have 28 days to complete the sale and pay the balance money owed. Sales contracts may vary; it is, therefore, advisable to have your solicitor read the contract thoroughly in case the timeframe is shorter or longer than normal.
The buyer will typically lose their deposit and any other charges they have paid to secure the purchase. There may also be other penalties payable, of which can be advised by your solicitor. Please discuss this with your solicitor or a member of our staff if you find yourself in this situation.
We often advise successful buyers to insure their properties upon exchange of contracts. It is also a good idea to check the legal pack to see whether the seller will continue to insure the property or not. You may contact a member of our staff or speak to your solicitor to confirm this.
Rents are payable to you upon completion of transfer in the Land Registry. You should, however, liaise with your solicitor and the existing tenant to have a rental payment system in place prior to this date.
You may move in as soon as the entire sales process is complete. This is typically as soon as the property transfer is officially registered with the Land Registry. The auctioneer will be informed by the seller’s solicitor to release the keys to the buyer as soon as all legal paperwork is finalised.
A member of the auction team will get in touch with you to pay the balance required.
General Questions
A buyer’s premium is a fee that is payable by any winning bidder to the auctioneer at the time of exchange. This is payable on top of other charges like administration fees.
An administration fee is an additional charge, on top of other fees, payable by any winning bidder to the auctioneer at the time of exchange. The amount is typically a fixed fee but may also be a percentage of the sale price (subject to a minimum amount). All payment details will be made available alongside property details.
Yes, it is possible. There are, however, further information and documentation required when a bidder opts to do this. The following are the information/documents required:
– Letter of authority under the company letterhead signed by the director(s)
– Company registration number and registered address
– Personal ID/residential proof of bidder
– Personal ID/residential proof of any major shareholders of the company (with 25% or more shares)
You should speak to a member of our staff if you are intending to purchase a property with an overseas company, in order to confirm the additional documentation required.
There may be additional fees on top of the administration charges and buyer’s premium. This may include reimbursement of the cost of searches and any other additional charges entailed in Special Conditions of Sale, which can be found in the legal pack.
The biggest reasons why one should purchase through an auction rather than a real estate agent is due to its speed, certainty and value. It is stipulated in the sales contract that all transfers should be completed within 28 days of the auction. This is significantly faster when compared to a real estate agency, where it may potentially take months to complete.
Certainty is also a huge factor because, as soon as the gavel falls, the seller is contractually obliged to sell to the highest bidder, subject to the reserve amount. No time is therefore wasted going back and forth between the two parties.
Finally, auctions are often seen as the best way to purchase a property in terms of value. Auctions work from the low end and work their way up to the highest bidder. Real estate agents, on the other hand, work from the higher end and eventually work their way down until a buyer is interested. It is, therefore, logical to believe that properties bought at auction are cheaper than through estate agents.
It is not compulsory to get surveys done for all properties you are purchasing. It is, however,
advisable for interested parties to seek advice from surveyors, builders or civil engineers if there are any concerns on the structure of the building. It is crucial to have all concerns clarified and addressed prior to the auction day as the sale contract is legally binding upon the end of the auction. You may approach a member of our staff if you have any queries or concerns so that we may advise you further.
Bidders should always check whether the properties they are interested in are mortgageable or not if they are looking to seek finance for them. The following is generally a list of issues that suggests a property is not mortgageable:
– No kitchen or bathroom
– Structural defects, damp, dry or wet rot
– Properties within the vicinity of mining works, landfills and recent areas of flooding and
subsidence
– Leasehold properties with typically less than 70 years on the lease, and/or a defective lease agreement
– Properties with boundary disputes or where planning permissions were not applied properly
– Properties in a very poor condition or those that require demolishing
– Non-standard properties: properties that are not constructed like a typical property in the
UK. A standard property consists of brick/stone walls and slate/tile roofs
– Properties that have a value below a certain threshold set by banks
Traditionally, auctioneers sell exclusively to traders, cash investors, builders and developers; it was rare to have private buyers attend auctions. Time has changed though. It is evident that auctions have become more mainstream, where one will see investors from all walks of life attending auctions and making bids. First time buyers, buy to rent investors, buyers requiring finance and others are rushing to auctions after hearing and/or experiencing themselves issues with purchasing through estate agents.
Due diligence is when one does everything within their power to do research on and confirm something. This phrase is, therefore, thrown around a lot in the property trade as there are a lot of background checks to be confirmed before one makes a purchase.
Contracts are legally binding upon the fall of the gavel. We therefore, advise you to not bid hastily if you are not 100% sure about a property. You will be breaching the sales contract and will consequently suffer heavy financial penalties.