Auction properties with sitting tenants - pitfalls?

canaldumidi

A guide price is a) just a guide and b) designed to attract interest.

Not unusual for bids to exceed this, sometimes considerably!

I really worry that you don't know nearly enough about the property, the tenants, or the tenancy to bid, especially given your own limited experience.

Perhaps once you've gained experience and confidence as a landlord you could look at expanding your portfolio via auctions, or more high-risk purchases, but I would not start out your business by jumping in the deep end!

Whatever you decide, best of luck and let us know.

user1977

chaotic_j said:

I asked the auctioneers if it's Modern Method of Auction and they said 'it's an online auction'. Have they avoided the question?

Who are the auctioneers/agents? You (obviously) shouldn't take part in it if you don't even understand how the auction works, never mind anything about the property.

chaotic_j

It's Edward Mellor @user1977 and they keep emailing and phoning me about these properties inviting me to place an offer under auction terms..

They say if the offer is accepted I pay their fee and begin the legal process to acquire the property..

Thoughts..?

canaldumidi

if the offer is accepted I pay their fee and begin the legal process to acquire the property..

Run a mile.

Or simply block them.

Read the full auction terms of conditions and make sure you a) fully understand them and then b) run a mile.

dimbo61

Thoughts

Run a mile !
Do you know or can you find the EPC for the 2up 2 down northern mill town properties.
Fit for habitation checks ?
Government pushing for all Rental housing to be "C " EPC by 2025/28 
Have you seen photos of the inside of the properties ?
EICR, GSC, Fire safety, Double glazing, Type of boiler and condition.
Yield ?

Amixo3032

Simple FACT DO NOT BUY FROM SOMEONE WITH SITTING TENANTS AS WHEN U BUY THE HOUSE YOU BUY THE TENANTS TOO... 

and you can inherit bad tenants who either don’t pay rent , trash the place , cause neighbours harm ect.. 

if I was you , avoid buying from someone who has sitting tenants

eddddy

chaotic_j said:

It's xxxx @user1977 and they keep emailing and phoning me about these properties inviting me to place an offer under auction terms..

They say if the offer is accepted I pay their fee and begin the legal process to acquire the property..

Thoughts..?

Presumably, they're emailing and phoning you because you've expressed an interest in those types of properties.

Realistically, that's what sellers expect auctioneers and estate agents to do - put some effort into finding potential buyers.


People who have the right knowledge and experience might do well buying tenanted properties at auction.

People who don't have the right knowledge and experience could end up with big headaches, and lose a lot of money by buying tenanted properties at auction.



To be honest, you do sound like you're out of your depth with this.

I've come across some pretty ruthless auctioneers. It's very possible that some auctioneers will spot that you're out of your depth - so they'll push the 'lemon' properties at you.

And they push the 'good' properties at the professionals, because they know the professionals are too smart to buy the 'lemons'.





Edit to add...
But I don't know the auctioneers you mention, so I'm not suggesting they'd do anything that (because I don't want to get sued!!)