Help! - How to buy a house at auction?

Lara

Well I'm getting excited for you Catts! Fingers crossed it all goes well and I'll keep up to date with this thread!

catt_2

Well, we went for the second and final viewing today.

We've come away quite disappointed. Last time it was so quiet with only 5 people viewing but what with Easter over they turned out in force today. At least 10 couples! The EA told us that one attended with his surveyor and the outcome is that he will go ahead and bid for the house. Another strong contender was an Asian family comprising 4 adults who don't want a survey as they intend to demolish and rebuild with a bigger house!
The EA thought that it would make a good family home and that developers would not be interested as there is insufficient margin in it.
The figures the EA was bandying about price the property beyond our means.

So all in all quite disappointed really. Would say more but OH is calling me away from computer....

More later- if you are interested....

Tiger_greeneyes

catt wrote: »

Well, we went for the second and final viewing today.

We've come away quite disappointed. Last time it was so quiet with only 5 people viewing but what with Easter over they turned out in force today. At least 10 couples! The EA told us that one attended with his surveyor and the outcome is that he will go ahead and bid for the house. Another strong contender was an Asian family comprising 4 adults who don't want a survey as they intend to demolish and rebuild with a bigger house!
The EA thought that it would make a good family home and that developers would not be interested as there is insufficient margin in it.
The figures the EA was bandying about price the property beyond our means.

So all in all quite disappointed really. Would say more but OH is calling me away from computer....

More later- if you are interested....

One thing to remember is that half of those couples could be neighbours having a nose around! I wouldn't discount it on the fact that there were a few viewers, it doesn't automatically mean that they'll all be at the auction

catt_2

You could be right Tiger. The EA said there had been a lot of "local interest".

The EA also said some people had come from further afield. We overheard some of them ask him "What do these properties sell for?" It was like they'd done no research of their own.

The EA also said he couldn't understand why the auctoneer had increased the guide price beyond what the EA was marketing it at locally. He thought the auction could fetch way beyond the owner's expectations.

He described the no. of viewings and level of interest as "strong".

Tiger_greeneyes

Have you got any ideas on how you're going to proceed with this Catt? Are you interested enough to get the ball rolling with surveyors and mortgages etc?

Wig

catt wrote: »

All very interesting....

Lobright,
If it's 19 April I'm guessing yours is in the same Barnard Marcus auction. With 198 lots listed it's unlikely to be the same house! To further reduce the odds against it being the same one, ours only had 5 people viewing.

As for buildings insurance, a purchaser takes on the risk and hence should insure from exchange of contracts which at auction happens when the hammer falls.

Ems,
Our problem is that our intended lender probably can't get the valuer to visit the property in time for the auction. We are still working on resolving this issue somehow.

We'll keep you posted!

You realise, of course, Barnard Marcus only gives 14 days to complete (which can be even less in "special conditions"). If all you have in the bank is the 10% deposit, you had better be 100% sure your lender will lend you the rest on that property within 14 days so that your completion can take place on time.

As long as their is a real bidder in the room - bidding, you can gaurantee that there will be a stooge bidder in the audience who will bid up to the reserve against the real bidder. Have a value in mind, allow bidding to continue without you, if bidding exceeds your mark, walk away, if bidding stops before your mark - start bidding.

Good luck

catt_2

Tiger
We've undergone a telephone interview with a broker who has obtained finance for auction properties. We can have the level of lending we need in principle but have not processed the application. The broker said if we offer pre auction and are accepted, we would not risk the fees being for nothing.

So we telephoned BM's negotiator and are waiting to hear.

Wig,
That sounds unfair, but reading the terms, it does state the vendor has the right to bid on his own property up to the reserve. Another good reason to put an offer in beforehand.

Tiger_greeneyes

Well done for finding an auction experienced broker Catt - there can't be that many of them about

real1314

Wig wrote: »

As long as their is a real bidder in the room - bidding, you can gaurantee that there will be a stooge bidder in the audience who will bid up to the reserve against the real bidder. Have a value in mind, allow bidding to continue without you, if bidding exceeds your mark, walk away, if bidding stops before your mark - start bidding.

Good luck

There doesn't need to be a stooge - the auctioneer himself can legally invent bids up to (just below)the reserve price. If it goes beyond the reserve he stops. If it doesn't meet the reserve, it's unsold. This is knowing as "bidding off the wall" iirc.
Lots of people think it's dodgy, but then again, he can only push it whilst it is at a price that it would not be sold at. Then again, you see lots of auction where people won't bid on a property starting at (e.g) £100k, so he starts it lower at £75k, but then the same bidders end up bidding up to £120k??
It's a game that's played by both sides.

catt_2

Thanks Tiger. We put in a lot of research which may help us next time.

The auctioneer, BM informed us today that there had been numerous pre-auction offers, some of which had been higher than ours and about 20 per cent above guide price.

That rules us out!