What Are The Advantages of Buying Property and Land at Auction?

Posted by The Landsite on 16th June 2022 -

The latest of our Spotlight On Series features leading property auctioneers Clive Emson and the advantages of buying property at auction.

Around 2% of all property transactions take place at auctions in the UK, which means that the vast majority of property sales are still made by private treaty, for example through estate agents.

However, Covid has driven a change in how property transactions take place with a noticeable increase in the number of deals taking place at auctions. 

This has been accelerated due to the ease of access in the form of online auctions, expedited by the pandemic as in-room public auctions could no longer take place. Online auctions appear to be a trend that is set to stay.

The interest in auctions was steadily rising even before the pandemic. Traditionally auction houses such as Clive Emson would be accepting bids from developers and property investors looking for a deal or a doer upper to sell on. Now, in a bid to access a wider property market people are considering auctions as well options via private treaty to buy and sell their homes. 

What are the advantages of buying at auction?

The sale is guaranteed:

Once the gavel (auctioneers hammer) has fallen exchange of contracts simultaneously takes place and both the buyer and seller are legally bound to buying/selling. This prevents any last-minute gazumping or buyers and sellers pulling out.  

Transparency: 

Auctions offer a fair way of everyone having an equal chance of securing a property as can witness other bidders’ intentions.

A faster process:

On the fall of the gavel there is an exchange of contracts, with completion 28 days later unless altered within the special conditions of sale which are made available to buyers before the auction. A buyer will need complete the required online anti money laundering checks (AML) and make sure they have ID such as driving licence or passport, proof of address, solicitor details and means of paying the deposit before the auction. 

Legal packs: 

Legal packs are available to all potential buyers prior to auction. This includes information such as searches, title deeds, leases for tenanted property, as well as any relevant planning permissions. Prospective bidders must read through the legal pack, and if possible get a legal representative to ensure there are no hidden terms or fees as part of the sale. 

Auction Methods 

Traditional method of auction:

On the fall of the gavel exchange of contracts takes place immediately. The successful buyer is required to pay 10% deposit on that day. 

Modern method of auction: 

A number of agents and auction houses are now selling properties under the ‘Modern Method of Auction’. On acceptance of an offer, on the fall of the gavel, a successful buyer pays a non refundable reservation fee to the auctioneer. Following acceptance of the buyers offer and payment of the reservation fee, the buyer is given 28 days to exchange and then a further 28 days to complete. 

 

To find the very latest properties throughout the UK by auction contact Clive Emson on The Landsite or go to  the Auction Channel for the latest news, guides, properties for sale at auction and more. 

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