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in House buying, renting & selling
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Hi has anyone bought but to let property from an auction before? Pros and Cons please?
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If our buyers never sell they'll never have our problem with the paperwork, but when repairs become necessary they will certainly have issues getting him to pay. If I could do it all over again, I wouldn't have ever bought that property.
And that's what auctions are all about. The seller can't back out without losing a lot of money, and is often unaware of the problems with the property, whatever they may be.
I'll guess you're thinking of buying at auction so will answer that. What you later do with the property is a separate matter.
* Before going to an auction to bid, go to one or two not to bid. Get a feel for auctions.
* read the auction pack. 3 times at least.
* unless you are very legally savvy, get your solicitor to read the auction pack and report to you. Before the auction.
* unless you are paying cash (and have the cash - all of it - accessible) apply for a mortgage before you bid. If you bid, win and then your lender declines to lend on that property, you're ****ed!
* don't bid till you're satisfied the building is sound. Either rely on your own building knowledge, take a builder friend round, or pay for a survey - all before the auction. If you bid, win and then discover the property is falling down or needs a new roof, you're ****ed!
* remember why properties are put into auctions. Usually there's a legal issue with the title or lease; or tenants who can't be shifted (eg not on AST), or structural issues; or some other reason the property is not on the 'normal' market.
* research the market. Have a clear understanding of general market prices for the type and location of the property you plan to bid on. Then set yourself a price limit
* during the bidding, remember your price limit and stop bidding at it!
All the above can mean paying out £ before the auction, on a property you might get outbid on.
Pros? if you do your homework, understand the risks, and strike it lucky bidding on the day, you might snap up a bargain. But remember that auction 'guide prices' often bear little resemblance to selling prices.....
It sounds like you might be fairly inexperienced at buying property - so buying at auction might not be the best option for you.
But if you're keen to find out more, maybe start by googling 'buying at auction' or something similar.
You'll find results like these:
Then, if there are specific things you don't understand, you can ask about them here.
If you really want to learn "all of it" then start by going on a relevant training course or buy:
(Do not do this children...) In Spring 2000 , having merely driven past a house having seen details in an agent's window, I went to an auction &, not having planned to, stuck my hand up: And got the house. Currently on the market for more than 6 times buying price. Turned out OK, but might well not have. But I could afford the gamble. Life ain't fair.
Suggest anyone considering buying at auction carefully reads all paperwork, views place slowly at least twice, ideally with someone who can advise on likely necessary repair costs etc etc..
I bought at auction in Scotland