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5 Things You Need to Know Before Buying a Home at Auction

Are you looking to invest in property? Buying homes at auction is a great way to get yourself started, and we know it can be somewhat of an overwhelming experience for anyone new to property investment. But it doesn’t have to be overwhelming. That’s why we’ve compiled this quick list to help get you ready for buying a home at auction!  

View The House Before the Auction 

When considering buying a home at auction, we suggest you view it in person at least twice. Consider taking someone with strong building knowledge on the journey with you because you will want to be looking out for any faults with the home.  

There are multiple things to look out for on an auction home, such as: 

  • Damp 
  • Rot 
  • Subsidence 
  • Leaks 

It’s worth contacting the auctioneer to arrange a full viewing during the daytime and running a quick drive-by viewing at night to survey the surrounding neighbourhood. 

What Should You Take When Viewing the Property? 

You want to ensure you’re making the right choice for your first property investment. That’s why you must take the right tools to help you get around the property and come to a decision efficiently. 

Tape Measure/ Laser: Either of these tools is an ideal choice for measuring around the home. A laser will make help to speed things up a bit if viewings are busy. 

Camera: You want to be taking images of every aspect of the property for future viewing and analysis. It helps to spot things you might have missed whilst there. 

Notepad: You should keep a record of the pro’s and con’s you find. You can cross-reference these with your images. 

Torch: A torch will help you illuminate any potential issues in the dull and dark corners of the property. 

Binoculars: You’re going to need a view of the roof of the property. That’s where the binoculars come in, aiding you in viewing the roofing, guttering, ridges and more. 

Portable Ladder: If the property has a loft, you will likely need a ladder to access it. If not, we still suggest taking a ladder to look closely at any issues you spot above head height. 

Appropriate Clothing: It’s best to wear long clothing and sensible boots (preferably steel-toe boots). Be on the safe side and keep yourself protected depending on the property condition. 

Check The Legal Pack 

The house seller’s solicitors should have prepared a Legal Pack available for you to review. Legal Packs include details regarding the fixtures and fittings, Land Registry, lease information, local searches, and further information relating to relevant planning permissions.  

Ensure You’ve Got the Funds Ready 

Most importantly, when buying a home at auction, you want to be financially ready, especially if it’s a form of borrowing. Borrowing could require the lenders to have the property surveyed before making you an offer. 

In most cases, if you win the auction, you’re required to sign the sale contract agreement and put down a deposit on the spot (Normally 10% of the overall purchase value). The remaining percentage is due within 28 days following the auction close.  

Don’t Get Caught Up on Guide Prices 

Homes under the hammer are sold with a guide price. Fun fact, these prices are low to entice the underdogs. So, remember this, always budget above the guide price as properties are often known to sell for at least 10% or more than the guide price shown, according to Zoopla. 

If an auction attracts a significant level of interest, the guide price can also increase. So, if you’re interested in a home or property, just keep an eye out at these changes and don’t get ahead of yourself. 

Many of our graduates follow tips like these and this could be your first investment to get you on the road to many more. 

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