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Help please - what to set as limit at auction?

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Enm1
Enm1 Posts: 15 Forumite
edited 19 October 2019 at 10:06PM in House buying, renting & selling
We would value the opinion of the experienced posters on our dilemma...

We want to buy a studio flat in a specific complex due to location/safety/cost and there are 2 on the market. One is for sale by a traditional Estate Agent for £280000 (Rightmove property 73388560) and the other up for auction with a guide of £200000 (Rightmove property 85454363). We've seen both and they both will need updating and redecoration.

What should our limit be on auction day? We're thinking the reserve price is about £220000 (10% above the guide) and would love to get it for the reserve to allow more cash for refurbishment. Two other similar studios in the same complex are currently under offer / sold according to Rightmove and the last sale was for £275000 in January.

We are able to buy without mortgage and have attended an auction to see how the process works and know we will have to complete within 4 weeks of the auction etc.

Any thoughts on our plan? We're a bit concerned about Brexit and the housing market but want to buy the flat for our daughter who just started at University in London and will need to move out of her halls of residence next summer, so we could delay the purchase until the New Year?


PS sorry can't post links as I've just signed up having been a MSE observer for many years :j:j:j
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Comments

  • mark55man
    mark55man Posts: 7,924 Forumite
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    I think I Wouldn't be putting specific amounts here, although I guess the odds of someone interested in the house reading this are slim. I think you should seek general auction tactics - rather than specific numbers for this house. Try watching homes under the hammer that should help you - remember the legal pack and the extra costs though :-)
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  • Enm1
    Enm1 Posts: 15 Forumite
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    Thank you mark88man. We've read the legal pack and figured the auction costs into our price limit. Our solicitor is also looking over it at the moment.

    Just need to be disciplined on the auction day and not get carried away as we attend an auction recently and there was quite a frenzy and everyone could feel the tension in the room for some properties. Going to try and get to another auction or two to try and get used to the atmosphere :T:T (and watch all the reruns of Homes under the Hammer over the weekend :rotfl::rotfl:)
  • diggingdude
    diggingdude Posts: 2,445 Forumite
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    Just be careful not to get carried away in the moment. Another flat will be along soon if you miss this one
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  • FreeBear
    FreeBear Posts: 14,631 Forumite
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    diggingdude wrote: »
    Just be careful not to get carried away in the moment.


    If the auction house will allow it, entering a proxy (or postal) bid would save getting caught up in a bidding frenzy.
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    Treasure the moments that you have. Savour them for as long as you can for they will never come back again.
  • Tom99
    Tom99 Posts: 5,371 Forumite
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    Whichever of the two flats you go for check out the service charge and any upcoming repairs as the block looks like a potential money pit.
  • [Deleted User]
    [Deleted User] Posts: 7,323 Forumite
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    And funding for any major repairs by the freeholder (big enough sink fund etc). There is usually a reason why properties are offered at auction. Look for these reasons.
  • getmore4less
    getmore4less Posts: 46,882 Forumite
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    First one says under offer
  • AdrianC
    AdrianC Posts: 42,189 Forumite
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    It's very simple.

    Set your upper limiit to a price you know you can afford and you know you can lay your hands on within 28 days - and which you believe it's worth in the condition you see.

    Then STICK TO IT. Like superglue. If the bidding goes even £1 above, get your hand down and sit on it until it's numb.
  • D.L
    D.L Posts: 137 Forumite
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    Just something to think about - is this solely for your daughter? After living in halls, most students prefer to live with a few friends rather than alone.
  • kinger101
    kinger101 Posts: 6,282 Forumite
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    D.L wrote: »
    Just something to think about - is this solely for your daughter? After living in halls, most students prefer to live with a few friends rather than alone.

    It's not necessary a case of preference. Most students have no option but to share ask one bedroom properties are out of their budget.
    "Real knowledge is to know the extent of one's ignorance" - Confucius
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