Are auctions really the place to bag a bargain

PD1

I've been watching a well known London auctioner's sale results, and nearly every property sold has gone for over the guide price - seems odd given the current climate. Are auctions really the place to buy cheap property, or is it merely hype?

poppysarah

Which one? I've seen loads not sell at auction

PasturesNew

The guide price is a teaser and doesn't really reflect what it will go for. At a lot of auctions, many houses sell for quite a lot higher than the guide price; on the other hand, at a lot of auctions, many houses don't sell at all.

Gorgeous_George

Guide prices are usually set low to generate interest.

Don't you watch 'Homes Under the Hammer'?



GG

PD1

poppysarah wrote: »

Which one? I've seen loads not sell at auction

Its Allsops, I 'm just trying to find a bit of land that went for well over the guide price....

PD1

I hope this link works:

http://www.auction.co.uk/residential/LotDetails.asp?A=602&RQ=SR&MP=85&ID=602000073&S=L&O=A

themanbearpig

I find guides are 10-15% undervalued...

So if its £60k, expect £65-£70. Investment properties are dictated by yields. They usually sell for 10x expected yearly income.

Doozergirl

You need to tell us the lot number.

No savvy buyer is going to find themselves getting what they want at the right price all that often; it's a case of really knowing your market and holding back.

We've had superb buys at auction.

PD1

Sorry Doozergirl, I thought the link was working ok, its lot 72 that caught my eye......by my maths it about 170% over the guide price....

That's why I feel that auctions are not the place to get a significant bargain.

Running_Horse

From memory there is quite a large regional variation. So an auction dealing with properties in depressed areas might have more bargains than affluent ones, and a lot more unsold.

Drea

A lot of properties at auction are no cheaper than buying elsewhere. People sell through auction mainly to benefit from the quickness of it all.

As for the guide price, in my experience it is set £5-10k higher than the reserve price, so not really that low.

The problem is people aren't being realistic about their reserve prices so most residential properties just aren't being sold and are having to be withdrawn.