Property Auction - sold in one auction appears again in another auction within one month

nasirbaig007

Hi,

Recently a lot of decent properties are appearing on online property auctions.

I have been watching a lot of auction houses  since last year. Looking at the recent activities i suspect some type of fraud or accounting adjustments are going on as i see same properties sold in one auction appearing in another auction with in 3 to 6 months apart.

one recent example i spotted is this bungalow which sold on 15 th feb 2022 in mchugh auction, but became available with Auction house london for their 15th mar 2022 auction lots . see both links below . i tried to contact auction houses but did not get a reply yet.

Does anyone have any idea what might be going on here ? 

as new member it does not yet allow me to post link. you can look for below address on mchugh auction past result from 15th feb 2022 and Auction house london current lot for 15th mar 2022 auction 

Mchugh - Lot 40A - 274 Cross Road, Mawneys, Romford, Essex, RM7 8HS

Auction House London - Lot 16 - 274 Cross Road Mawneys, Romford, Essex, RM7 8HS

user1977

Possibly just somebody buying and then immediately selling?

theartfullodger

There is nothing unlawful about buying a property on one day, then selling it a day later or otherwise shortly afterwards. In sharedealing it's known as a bed & breakfast deal - see
https://www.investopedia.com/terms/b/bed-and-breakfast-deal.asp

Perhaps there is some change - eg ejection of occupants, sorting of legal paperwork, quick bit of tarting up.

user1977

Or the original vendor had entered into successive auctions in case it didn't sell in the first one?

Thrugelmir

Watch and see if it gets withdrawn. As has already been said. Listings are made well in advance of the auctions themselves. 

jimbog

nasirbaig007 said:

Hi,

Recently a lot of decent properties are appearing on online property auctions.

I have been watching a lot of auction houses  since last year. Looking at the recent activities i suspect some type of fraud or accounting adjustments are going on as i see same properties sold in one auction appearing in another auction with in 3 to 6 months apart.

one recent example i spotted is this bungalow which sold on 15 th feb 2022 in mchugh auction, but became available with Auction house london for their 15th mar 2022 auction lots . see both links below . i tried to contact auction houses but did not get a reply yet.

Does anyone have any idea what might be going on here ? 

as new member it does not yet allow me to post link. you can look for below address on mchugh auction past result from 15th feb 2022 and Auction house london current lot for 15th mar 2022 auction 

Mchugh - Lot 40A - 274 Cross Road, Mawneys, Romford, Essex, RM7 8HS

Auction House London - Lot 16 - 274 Cross Road Mawneys, Romford, Essex, RM7 8HS

https://www.mchughandco.com/Auctions/Details.aspx?aid=1156&pid=2b269c05-e008-4e7e-b3b7-3b9023ba98b6
https://auctionhouselondon.co.uk/lot/274-cross-road-mawneys-romford-essex-rm7-8hs-163777/

nasirbaig007

user1977 said:

Possibly just somebody buying and then immediately selling?

i am not aware of property purchases completed within 15 days. Also for prospective buyers it will be difficult to get financing afaik

user1977

nasirbaig007 said:

user1977 said:

Possibly just somebody buying and then immediately selling?

i am not aware of property purchases completed within 15 days. Also for prospective buyers it will be difficult to get financing afaik

They can complete that quickly if people are minded to, but in any event it isn't necessary - as long as the vendor is in a position to complete by the completion date of the second auction.

And generally auctions are for cash buyers anyway (or those who already have financing on tap), not those who need time to go away and arrange financing.

Countrysider

I've noticed this a lot too, particularly since the move to online-only auctions. 

I think what a lot of posters above missed is that the property usually has a bidding war, meets the reserve and 'sells'. It then appears a month or so later for the same starting price and often achieves a similar sale price. Sometimes in the same auction, sometimes in other auctions. 

This is not a profit or flipping strategy. I suspect it's an example of 'the wall' getting the winning bid. 

eddddy

It seems it sold at the first auction. When the legal pack is available for the second auction - comparing legal packs may give a clue about what's happened.

Possibilities include...

• A 'newbie' bought the lot without finance and/or without realising that they can't get a mortgage

• Somebody bought it without viewing, and it wasn't what they expected.

• Somebody thought they had the money to buy it, but something 'went wrong'.

So the buyer negotiated a deal with the seller to put it in the next available auction, with the buyer agreeing to pay all costs/losses (and maybe a sweetener on top).

That's probably better for both seller and buyer, than if the buyer 'sticks their head in the sand' and fails to complete after 28 days.





Edit to add...

Countrysider said:

 I suspect it's an example of 'the wall' getting the winning bid. 

It's unlikely in this case - it shows as having sold for £404k. Otherwise it would show as 'Available' or 'Withdrawn'.

Also, with 'off the wall' bids the hammer wouldn't go down. The auctioneer would say something like "It hasn't reached reserve, come and talk to us if you're interested."

Countrysider

eddddy said:

It's unlikely in this case - it shows as having sold for £404k. Otherwise it would show as 'Available' or 'Withdrawn'.

Also, with 'off the wall' bids the hammer wouldn't go down. The auctioneer would say something like "It hasn't reached reserve, come and talk to us if you're interested."

That may have been the case in times gone by, but i suspect moving this practice to an online environment has had some challenges. 

Consider this example: 

• Shown as sold for £40K on the 22nd Feb and looks to have had 2 bidders https://online.auctionhouse.co.uk/lot/details/60780 
• 4 days later it is listed in another auction happening on 9th March https://www.rightmove.co.uk/properties/120389936#

I can't believe anything could have happened in those 4 days. As an aside, this property was also 'sold' last April for £46K, but given the timeframe that may have been a genuine sale.