Subscribe to Newsletters

Recent Related Stories

Auctions: can buyers still bag a bargain?

Posted by Jude Buttle on Friday, October 24, 2008

There was a time when all you would do was turn up for an auction, wait for the property you desired, bid for it, obtain it, pay for it, do it up and sell it on... But times have changed, haven't they?

The Good Old Days

‘Buy low sell high' is an old profit making axiom that applies so aptly at auctions and one that is feverishly encouraged by day-time television programmes.

But it's not just the profit margin that appeals to investors; other attractions are the speed of the purchase and the transparency of the transaction.

Previously, when house prices were going through the roof, investors and home seekers were flooding auctions hoping to secure a property for very little fuss and cost. Their aim was to purchase a property that was undervalued, whether it was because it needed repair, refurbishing or it was a repossession. The reason didn't matter as long as there was a bargain to be had.

Hard Times

But recently, times have changed, with the ‘credit crunch' looming over everyone's heads. Sellers are sitting tight and leaving their properties off the market, price growth has ground to a halt and as a result, attendance at auctions isn't what it once was.

Opportunity Knocks

But this absence of competing buyers represents a huge opportunity for canny investors to still bag a bargain at auction.

Many sellers seem frustrated with the current property scene, dealing with estate agents and buyers that try to gazump them. They are tired of seeing a ‘for sale' sign outside their home for months on end and losing sleep about their property chain collapsing.

Therefore now could be the time that many sellers want to simplify their sale by putting their property into an auction and dealing with a quick, efficient and transparent way of selling.

This all bodes well for the potential buyer, as a seller that is desperate for a quick sale will be more prepared to accept offers well below market value.

Also, the number of properties that have been repossessed recently is on the rise, mainly due to homeowners struggling to maintain payments on the increase in their mortgage rates. This means more properties end up at auction houses.

This means that well maintained homes are popping up at auctions as more and more regular sellers that would normally go direct to an estate agent, are now trying their luck at auction.

To the Victor, the Spoils

Buying auction property now accounts for an estimated five per cent of all property transactions, according to the Royal Institute of Chartered Surveyors (RICS) and around 25,000 properties now go to auction every year at more than 200 auction houses nationwide.

Purchasing a property at auction means you will complete on the deal within 28 days. Considering that the traditional method takes an average of 12 weeks from the day an offer is accepted until contracts are exchanged and almost one in three agreed sales collapse, it's easy to see why buying at auction is such an attractive proposition and still a great place to bag a bargain.

Search for Auction Property

If you're interested in buying auction property, then start by looking at our webpage for auctioned properties for sale at forthcoming events. http://auctions.themovechannel.com/

Photo by bloomberries

No Derivative Works. You may not alter, transform, or build upon the photo image.

 Print

Bookmark This Page

Tag, share or bookmark this page: