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buy a house at an auction?

Rijndael
Rijndael Posts: 7 Forumite
in House buying, renting & selling
Has anyone bought a house via an auction ? How did it go ? Any caveats I should be aware of ?

I am looking for a house in and around london and am not too concerned if the place is quite gutted since Im a pro diyer and can do it up to taste.

Comments

  • Yorkie1
    Yorkie1 Posts: 12,072 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Combo Breaker
    You MUST get the legal pack in advance and get a solicitor to go through it with a fine toothcomb.

    You MUST get a proper survey done in advance.

    You MUST get your mortgage arranged as far as possible in advance.

    Make sure you know what similar properties have sold for in the last 3-6 months.

    Set your budget and do not go over it.

    If you win at auction then you have to pay a deposit on the spot (10%?) plus - possibly - auction house fees.

    You are legally obliged to complete the purchase once you have won at auction; no backing out later.

    And I *think* there is a very short time for completion, perhaps 28 days? So there is absolutely no scope for delays.

    Because of the above, it is often said on here that buying at auction is for experienced, cash, buyers.
  • Naf
    Naf Posts: 3,183 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    I was going to say definitely get a survey.
    Even as a keen DIYer, could you deal with subsidence yourself? Or replace the roof?
    Never argue with stupid people, they will drag you down to their level and then beat you with experience.
    - Mark Twain
    Arguing with idiots is like playing chess with a pigeon: no matter how good you are at chess, its just going to knock over the pieces and strut around like its victorious.
  • joolsybools
    joolsybools Posts: 1,595 Forumite
    I think you have to pay VAT on top of the purchase price - can someone confirm?
  • anselld
    anselld Posts: 8,650 Forumite
    Part of the Furniture 1,000 Posts Name Dropper
    joolsybools wrote: »
    I think you have to pay VAT on top of the purchase price - can someone confirm?

    Check in the legal pack, but not usually, no.
  • ognum
    ognum Posts: 4,879 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Do you need a mortgage? Will you have time between auction and completion to get one?
  • Valli
    Valli Posts: 25,500 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ognum wrote: »
    Do you need a mortgage? Will you have time between auction and completion to get one?


    Since the accepted (final) bid forms a legal contract a winning bidder MUST have funds in place prior to bidding.
    Don't put it DOWN; put it AWAY
    "I would like more sisters, that the taking out of one, might not leave such stillness" Emily Dickinson
    :heart:Janice 1964-2016:heart:

    Thank you Honey Bear
  • Annisele
    Annisele Posts: 4,835 Forumite
    Part of the Furniture 1,000 Posts Name Dropper Combo Breaker
    If a property is being sold at auction, there's usually (not always) something wrong with it.

    It might in serious disrepair (and missing its roof, or a wall or two).

    It might have a sitting tenant (so you couldn't move in to it until the tenant left or died).

    It might have a very short lease (so you'd be paying for the right to live in it only for a few years).

    It might have any number of other problems - or it might be absolutely perfect and the vendor just wants a quick sale.
  • PasturesNew
    PasturesNew Posts: 70,698 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Other clauses you might find in the legal pack include:
    - having to pay the legal costs of the seller
    - having to settle an undeclared debt sum
    - not being allowed to live in the property, but only allowed to sell it on or rent it out
  • ognum
    ognum Posts: 4,879 Forumite
    Part of the Furniture 1,000 Posts Combo Breaker
    Valli wrote: »
    Since the accepted (final) bid forms a legal contract a winning bidder MUST have funds in place prior to bidding.

    that is exactly why I asked the question!
  • Valli
    Valli Posts: 25,500 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    ognum wrote: »
    Do you need a mortgage? Will you have time between auction and completion to get one?
    ognum wrote: »
    that is exactly why I asked the question!

    But you asked if OP would be able to get a mortgage 'between auction and completion'. Finance needs to be in place before the auction.
    Don't put it DOWN; put it AWAY
    "I would like more sisters, that the taking out of one, might not leave such stillness" Emily Dickinson
    :heart:Janice 1964-2016:heart:

    Thank you Honey Bear
This discussion has been closed.
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