Conveyancing on a house bought at auction.

GDB2222

Why would you bother with any searches after you have exchanged? Besides, those ought to be in the seller's legal pack. Freehold makes it a lot easier, and your local knowledge of the area is very useful.

GDB2222

Have a look here:
http://www.northampton.gov.uk/site/scripts/documents_info.php?documentID=592&pageNumber=7

Or here: http://www.ukradon.org/

I thought you knew the local area very well? So, shouldn't you be aware of this problem, anyway? It won't just affect this one house.

Entertainer

When you get details of planning applications check at the property to make sure there haven't been any surprises added like extensions without permission. This is one of the advantages of doing your own conveyancing- a solicitor will never actually visit the property to pick up on things like this.

After contract, it is basically requisitions and completing the TR1 form, along with paying the Stamp Duty and completing Land Registry form. There's no reason why you can't do this, I have, many times.

GDB2222

Good luck. May I suggest being very hard-nosed about the cost of all the renovation work needed? You really do want to use the formula:

Amount I pay = Value of house in good condition LESS cost of works LESS contingency LESS a bit for my time and effort

Sadly, many people use the formula:

Amount I pay = Value of house in good condition LESS about half the cost of works (because that looks fairly cheap, and maybe they underestimate the cost of the works?)

Particularly as prices are falling, you can't afford to do that.

DocProc

Frances

When there is very little legal information being given then BEWARE.

There might well be a Title Defect. Look out for something saying:-

"The buyer will buy with full knowledge of the situation and will later make no requisitions in this regard."

In legal speak, this means THERE IS DEFINITELY a TITLE DEFECT.

This means that you CANNOT PROPERLY REGISTER TITLE TO THE PROPERTY.

And so this means that the property is UNMORTGAGEABLE and UNSALEABLE.

And if you have signed a contract to purchase the property at Auction, then that's what you have contracted to do. And you will be given 28 days or maybe less to complete the transaction. If you don't complete, you will be sued for Breach of Contract and for Losses and Damages and Costs.

The best way to buy a property at auction is to

1. Get the Legal Details and have them looked over by your solicitor. This will probably cost you about £500 or maybe a bit less.

2. If he says 'everything is alright' then and only then off you go to the auction, safe in the knowledge that most likely only the practical building issues are the things that need putting right. This is when you can bid but only up to your pre-determined limit. Don't let Auction Fever get you carried away. (This is when bidders get the 180 bpm heart rate and an adrenalin rush. The things that won't let you stop bidding and make you determined to get the property at all costs).

Take Care!

greenface

DOCPROC great advice spoton

Keith

Frances63 wrote: »

Hopefully (if I win it) it will be just under the new stamp duty threshold (175) so that's one less thing to worry about.

If it's over 40k then you still need to complete the SDLT return

DocProc

Frances

I'm glad you've been to see your solicitor first.

Before you go to an auction, this is absolutely vitally important.

I admire your bravery. I'm glad you are not going about it stupidly and mystically.

I really do wish you good luck! And I really hope you get a bargain.

If you do, then it will pay for your solicitor's fee in checking over the legalities beforehand.

If you don't and are determined, then 'there's always next time', eh?

There is only one way to get rich, as far as I am aware. That is, to try to acquire assets that apppreciate in value. Not many of them will ever be given to you, so you have to go out there and buy them.

To measure your wealth: Add up the monetary value of all of your assets and then subtract from this, the monetary value of all your debts.

Easy peasy, lemon squeezy!

Conrad

Most of my experienced investor clients expect prices to fall for a good while yet, and Fred Harrison who predicted this credit crunch a log while back is now saying prices will fall for 4 - 6 years.

The rental yields after all costs dont work either yet. Experienced investors want the yields we used to see 14 years ago - close to 15%.
Working out yields after ALL costs (dont forget annual repairs, rat catchers, accountants fees, gardening etc etc), I find the better yields now come in about 7%, still far to low to qualify as a smart investment given a backdrop of falling asset prices.

Conrad

If I was to buy now, the following equation needs to be satisfied;

PEAK 2007 'REAL' SELLING PRICE POINT MINUS 40/50%, MINUS ALL EXPENDITURE (aquisition costs, improvements, and if applicable resale costs).

Thus a £100k property in July 2007 that needed £10k works plus £2,000 aquisition fees is now worth £48000, and for that I would need a 10% yield, or £4800 pa AFTER annual costs.