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Straightforward Publishing - Roger Sproston

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63 pages

English

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It is often thought that buying or selling property at auction is complicated and risky and should only be undertaken by those with experience. However, nowadays, property auctions are an increasingly popular way for people to buy a home, increase their residential or commercial portfolio or sell an existing property. This book will guide to reader through the entire process. It is packed with useful information and will ensure that the experience will be based on solid foundations, and that people avoid the pitfalls inherent in buying property at auction. The effects of COVID 19 on property auctions will also be covered.

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Publié par	Straightforward Publishing
Date de parution	28 septembre 2021
Nombre de lectures	0
EAN13	9781802360714
Langue	English

Informations légales : prix de location à la page 0,0300€. Cette information est donnée uniquement à titre indicatif conformément à la législation en vigueur.

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A STRAIGHTFORWARD GUIDE TO BUYING AND SELLING PROPERTY AT AUCTION
A STRAIGHTFORWARD GUIDE TO BUYING AND SELLING PROPERTY AT AUCTION
ROGER SPROSTON BA MSc

Straightforward Publishing www.straightforwardco.co.uk
Straightforward Guides
Straightforward Co Ltd 2021
All rights reserved. No part of this publication may be reproduced in a retrieval system or transmitted by any means, electronic or mechanical, photocopying or otherwise, without the prior permission of the copyright holders.
ISBN: 978-1-913776-72-5
ePUB ISBN: 978-1-80236-071-4
Kindle ISBN: 978-1-80236-082-0
Printed by 4edge www.4edge.co.uk
Cover design by BW Studio Derby
Whilst every effort has been made to ensure that the information contained within this book is correct at the time of going to press, the author and publisher can take no responsibility for the errors or omissions contained within.
Contents
Introduction
Chapter 1. How Auctions Work
What is a property auction?
Different types of property auction houses
Those who attend auctions
What types of property are suitable for auction?
Main points from chapter 1
Chapter 2. Selling at Auction
Advantages of selling at an auction
Who sells at an auction?
When do you want to sell?
What information do auctioneers need?
Proof of identity
How much does it cost to sell?
Auction entry fee
Commission
Sales particulars
Legal documents
Guide price
Marketing your property
E marketing
Advertising and PR
Targeted marketing
Viewings and surveys
Legal documentation
The reserve price
Auction day
The fall of the gavel
Exchange of contracts
What happens if the property doesn t sell on the day?
Main points from chapter 2
Chapter 3. Buying Property at Auction
How and why do I buy at auction?
Why is property being sold at auction?
What happens next?
How do prospective purchasers find out legal and survey information for the properties in which they are interested?
How is finance arranged?
Can lots be bought before auction?
What happens on auction day?
What should I take with me to the auction room?
Prospective purchaser unable to attend?
Will the property be insured when I purchase it?
Main points from chapter 3
Chapter 4. Finding a Property at Auction
Repossessions
Perusing the auctioneers catalogue
Sample details from an auctioneers catalogue
The order of lots in an auctioneers catalogue
The guide price
Finding a property suitable for you
Viewing an auction property
Using a surveyor
Types of surveys
General tips
Using Google maps
The legal side of things
Main points from chapter 4
Chapter 5. Obtaining Finance for Auction Property
Financing an auction property
Paying cash
Borrowing money to fund a purchase
Main points from chapter 5
Chapter 6. Doing Your Sums-What to Bid
Costs
Stamp duty
Other costs
How to determine what price to pay at auction
Knowledge of the local area
Calculating the costs of works to a property
Selling costs
Calculating the bid price of a property
Rental yields and capital yields
Buying property before auction
Main points from chapter 6
Chapter 7. The Day of The Auction!
The day of the auction
The role of the auctioneer
Bidding for your lot
Bidding in increments
Unsold property at auction
Withdrawn property
Main points from chapter 7
Chapter 8. Procedure After Auction
Exchange of contracts
Sample sales memorandum
Delays in completion
Main points from chapter 8
Chapter 9. A Day at The Auction!
Conclusion
Glossary of terms
Index
****
Introduction
Most of us have watched programmes on television such as 'Homes Under the Hammer'. This involves people, mainly investors, purchasing a property at auction and refurbishing it and selling it on. However, there are also many non-investors looking to buy a property at a decent price and live in it as their main home.
This book, updated to 2021 , is intended for both of the above groups. It also covers the large variety of other properties that come up for auction, including commercial properties.
COVID 19 and the effect on property auctions
The Pandemic, and the associated lockdowns, initially brought the whole of the UK property market to a grinding halt. Every aspect of the housing market was affected, from the ability to purchase or sell a house (estate agents and auctions) to solicitors and the conveyancing process plus the Land Registry and any other associated parties to property transactions.
Thankfully, at the time of writing, things are slowly getting back to normal. Because of the pandemic, one area that has grown is that of online property auctions, where transactions can be done locally. We cover online auctions in chapter one.
Auctions generally
In addition to providing advice and information for buyers of property, the book also offers advice for the seller, explaining how the auction process works.
For those buying a residential property at auction, mainly developers, buy-to-let investors and those looking to purchase a home, auctions can mean that buying a house doesn t involve endless viewings with estate agents and then months of waiting to exchange contracts, with the possibility of gazumping along the way. Once you have made your bid and the gavel comes down then the property is yours on the spot.
Buying a house, particularly in the distorted London housing market, can now be an extremely frustrating and uncertain process. This is why buyers are now looking to auctions to circumvent the hassle of looking for, or selling, a house.
With house prices continuing to rise, people are looking for value, looking for some way to get onto the property ladder and are turning to auctions, where there are still bargains to be found and the usual rules relating to house purchase do not apply. The stamp duty holiday, due to end on September the 30th 2021, has also provided a surge in demand. Even after the stamp duty holiday deadline, auctions will likely remain a popular way to buy and sell. As a whole, the property industry is embracing advances in technology. And online auctions may continue soaring in popularity, especially in areas seeing strong buying demand.
Needless to say, there are many things to watch out for and many pitfalls to avoid when buying property at auction. These will be discussed in depth in this book. In short, when buying at auction:
be certain of what you want and what you want to do with it
Never rely on the catalogue alone-always go to see the property.
If possible, get a surveyor involved before making a bid for the property-this will save you a lot of time and money later on
Talk to the auctioneer in advance of the sale-they are duty bound to let you know of any problems that they know of
Make sure that you understand the legal pack and have a firm idea of what you are letting yourself in for
Make sure that you have the finance in place
make sure that you understand the process-try to attend an auction before you put in your own bids.
This book should prove invaluable in taking you through the process of buying (and selling) property at auction and put you in a strong position when bidding. Remember, as we have stated above, when the gavel falls the property is yours-make sure that you have bought the right one and are on safe ground.
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Chapter 1
How Auctions Work

Whilst most of us have a basic idea of how auctions work, and have watched various programmes which deal with property and other lots, it is important to delve a little deeper and gain a broad understanding of what an auction is, specifically a property auction, what can be bought and sold at property auctions and how we can close deals and get what we want on the day.
The below is a general overview of how an auction works and what actually happens on the day. It offers advice to both buyers and sellers. We will be discussing each area in detail in the following chapters. However, this will give you a general flavour of the whole process.
What is a property auction?
The process is very similar to the normal method of private sale. However, for an auction sale the seller and their solicitor carry out all the necessary paperwork and legal investigations prior to the auction. Subject to the property receiving an acceptable bid, the property will be 'sold' on auction day with a legally binding exchange of contracts and a fixed completion date.
Online property auctions
As COVID-19 restrictions have limited in-person property auctions in the past year, online auctions have surged in demand. Auctions, and particularly online auctions, have become an increasingly popular way of buying and selling, especially in the past year. This offers many advantages to both sellers and buyers. The sector will likely see further growth in the coming months and years.
The rise of online auctions
Online property auctions have been offered for a number of years now. However, due to COVID-19 restrictions, auctions haven t been able to take place normally in-person for over a year. Because of this, some auction houses quickly switched to online-only offerings. These kinds of auctions provide a unique and modern way to buy and sell. And these have been particularly popular in the past year.
With restrictions easing, there will likely be an increasing transition back to in-person auctions. However, after the success of online auctions, many auction houses are expecting to develop a hybrid structure moving forward, allowing buyers to make bids in-person and online.
Different types of property auction houses
Auction houses vary in size and the amount of business that they conduct and the frequency with which they hold auctions. Most will sell both residential and commercial property and each will have its own style of operation, and fee structure.
Large auction houses will hold auctions frequently, perhaps every two months and will have around 250 lo