Property investment/Auction

RHemmings

Herzlos said:

WellKnownSid said:
Every time I've looked at auctions, they've always seemed like a cesspool of basket-case un-mortgageable properties.

Who else would put a house through an auction?

People who need a quick sale. E.g. to pay care home fees before interest mounts up. 

user1977

RHemmings said:

Herzlos said:

WellKnownSid said:
Every time I've looked at auctions, they've always seemed like a cesspool of basket-case un-mortgageable properties.

Who else would put a house through an auction?

People who need a quick sale. E.g. to pay care home fees before interest mounts up. 

Or generally properties which are sellable, but where the market is limited and the seller doesn't want to spend a year marketing it.

Albermarle

WellKnownSid said:

I've developed a few properties over the years - not professionally, just for a bit of fun.  One place took 18 months to finish, I wasn't exactly rushing.  I remember distinctly taking two evenings out to do a brilliant job of the flooring in one of the toilets only for the plumber to come along 48 hours later and flood the place, ruining the brand new floor.

Every time I've looked at auctions, they've always seemed like a cesspool of basket-case un-mortgageable properties.

Death provides a steady stream of genuine previously loved properties in estate agent windows.  Much of the work is often just cosmetic - and carpets are flowery enough / bathrooms are drab enough to put off even the most determined FTB.  Look for labels on the kitchen units ("cereal", "bread", "cups") designed for carers - that means the kids aren't local or have much time...   They probably won't have the chops to 'do the place up' anyway.

If there are only one or two children, they could just want their money and will negotiate, whereas a large number of children will struggle to make a decision and there is always one that wants more.

Auctions?  They're only for the gamblers I reckon...

Family FTB has just offered on similar property. ( 85 year old gone into care)  Despite upping original bid by 8.5%, lost out to another FTB who went significantly over the asking price.
So you can not make too many assumptions.
Probably in this case it is because the area is quite expensive, and Bank of Mum and Dad are advising offspring if they want anything bigger than a rabbit hutch, they have to see through the flowery carpets.

tacpot12

To come back to the orginal question; I can't really answer it, but I can say that each auction house is going to have its own set of charges, with its own names for them. 

The best thing to do is to ask questions about each charge (what it is for and when it applies), make notes, and then create a spreadsheet that you can access on your phone that allows you to see the price you will pay for any given bid. Really the charges should be spelled out in the T&Cs. The T&Cs will usually have an Entire Agreement clause in them, so you can't rely on answers given by email, but this may be all you have to go on! 

Have you considered partnering with someone who also wants to get into proeprty development? You will benefit from having a formal partnership agreement, and it certainly adds complexity and some new risks if you do form a partnership, but it might also de-risk the project somewhat.