Buying at auction

ribenacreep

Hi. I was wondering if anyone could offer any advice.
I bought a house almost two years ago, and now I'm relocating and I've accepted an offer. The buyer is really keen and has paid for a survey to happen tomorrow, and is pushing us to sign the paperwork.
We've found a house we like. It's a victorian detached house that needs some work. We wanted to make a normal offer, but it's being sold by modern auction. It was on at one guide pricet, but the guide price has dropped by £15,000 over the last week, so clearly there hasn't been much interest. The estate agent said there have been about a dozen viewings.
We want the property, but we're not sure it's worth the guide price, so we wanted to make an offer just below the guide price before the auction (which is next Wednesday). We are not sure whether to get a survey, as if the offer is rejected and someone is ready to bid more anyway, it seems like money down the drain.
Also, if our offer is accepted, we have to pay a non-returnable fee of £6000 to secure the property. If my buyer drops out, I won't be able to exchange contracts in time and I'll lose that £6000.
I love the house. Is it worth the risk? It needs some major work to make it resellable (windows put in where there are none, potentially converting a basement), but could be an amazing house after all the work is done, with a lower mortgage. We have enough cash to fund the work from money we made on our last house, and the house is in a state where it would be safe to live in for a while.
Any advice would be greatly appreciated!!

G_M

Buying at auction (or in advance where there's a non-refundabe fee) is a huge commitment. Backing out in either case is majorly expensive.

Don't even consider either until:

* you or your solicitor have checked the legals
* you or your surveyor have checked the property condition
* you have the money, either in cash, and/or or in the form of a confirmed mortgage offer, and/or tied up in a property sale where you have exchanged contracts.

Running_Horse

Search this forum for "modern auction method" and have a good long hard think.

rosie383

Regardless of anything else that you do, auction or otherwise, you would be ABSOLUTELY NUTS to buy a Victorian house in need of considerable work without getting a survey. If you can easily a lot of things that need to be done,how much can you not see?

Davesnave

Running_Horse wrote: »

Search this forum for "modern auction method" and have a good long hard think.

I can see plenty in it for the EA, but as a potential buyer, I'd not touch it with the proverbial barge pole.

ribenacreep

Thanks for your replies. I've had a look at the other posts and it does look pretty risky and a total swizz. We also tried to offer a 'normal' offer to the agent but they said it wasn't possible.


I think we'll go to the auction, see if the property sells, and if it doesn't, put in a cheeky offer. It's still a risk but we should have exchanged contracts with our buyer by then.


Thanks for all your advice. I think it's likely we won't get this house. Such a shame but the process is so offputting!

G_M

ribenacreep wrote: »

I think we'll go to the auction, see if the property sells, and if it doesn't, put in a cheeky offer. It's still a risk but we should have exchanged contracts with our buyer by then.

Keep you hands firmly in your pockets at the auction!

Since you won't have checked the legals, or survey, or have the mortgage arranged, do NOT be tempted even if the property appears to be selling for a song.....

anselld

ribenacreep wrote: »

Thanks for your replies. I've had a look at the other posts and it does look pretty risky and a total swizz. We also tried to offer a 'normal' offer to the agent but they said it wasn't possible.


I think we'll go to the auction, see if the property sells, and if it doesn't, put in a cheeky offer. It's still a risk but we should have exchanged contracts with our buyer by then.

Making an offer before or after auction will not change the terms. It will still be modern rip-off.

ribenacreep

I still might bid, if it's an absolute steal. My solicitor is looking over the documents before the auction. Haven't had a survey done though. I imagine I won't bid because there is a bid from a cash buyer anyway. It does seem like my of chance of getting a
Period detached home in a nice area if I pull it off though, and we have done renovation work before (changed stairs direction, put bathroom upstairs, rewire, added central heating), but it was in a 60s property.

maninthestreet

You really need to have liquid cash in the bank to buy a property at auction.

G_M

ribenacreep wrote: »

I still might bid, if it's an absolute steal.

If it's an absolute steal, there will be a reason. Otherwise a Developer would be bidding.

'course you won't find out till later what the reason is.....