The tangible excitement and potential for a bargain are just two of the factors that make Property Auctions UK so appealing in the UK. Although such events are not for the faint-hearted, an auction is a place where great deals can be found. Buyers may also experience far fewer delays than in the open market. However, there are a few pitfalls which newcomers should be aware of before they commit to purchasing a property at an auction.
Traditional Versus Modern
Traditional auctions usually require the buyer and seller to be in attendance. At the end of the process, the winning bidder must exchange contracts with the vendor immediately after the auction ends. A modern auction - sometimes referred to as a conditional auction - simply requires that a non-refundable reservation fee is paid in order to reserve the property for a period of 28 days. Contracts must be exchanged within that period, and a further 28 days is given for the completion of the sale. The vast majority of buyers prefer the modern auction as it provides a far greater level of flexibility.
The Benefits of Buying Property at a Modern Auction
Major auction houses have made the process of buying property exceptionally easy. It is often
possible to place bids via telephone, and an increasing number of auctioneers are allowing online bids. Indeed, some online-only auctions last for up to 30 days, and that can give buyers plenty of time to think each bid through fully. Once a bid has been deemed to be successful, the 28-day arrangement period begins, so buyers have the luxury of knowing that time is on their side. Paying with a mortgage or finance can be stressful, but modern auctions allow plenty of time to arrange the necessary legal documentation.
Traditional auctions will often publish their property catalogues two to four weeks in advance. While this may seem like a long time, full inspections, assessments, valuations and other legal checks must be carried out during this time. Buyers go into a traditional auction knowing that there are no further opportunities to check the property's suitability. A modern auction will often be staged over multiple weeks, so a number of visits can be made to the property during the bidding process.
Deciding on the auction that is best for buyers is entirely dependent on their personal circumstances. First-time buyers, who are paying for a property with a mortgage, should generally stick to modern auctions, as they allow eight weeks at the end of the bidding to get the necessary paperwork and legal processes completed. Cash-buyers, who are experienced in buying property at auction, will often find it cheaper and quicker to buy properties at traditional auctions, as their investment spends less time being tied up with legalities. There are clear benefits associated with both forms of auction, and a property auction specialist or an estate agent will be able to offer expert advice appropriate to the client's specific circumstances.