There’s a certain mystique around property auctions. On the one hand they appear to offer the potential to snap up a house or plot of land for less than its true value. On the other, there’s the nagging fear of buying something that later turns out to be a money pit.
There’s also a sense that investors and developers tend to dominate property auctions, and that private individuals are likely to be at a disadvantage compared with the seasoned professionals that might be bidding on the same lot.
In practice, as a self builder you’re well-placed to buy successfully at auction – but it’s essential that you understand the process and potential pitfalls before you begin. A lot comes down to careful preparation – this is not at all about gung-ho bidding and speculation. By knowing the market in your area, researching thoroughly and taking professional advice where needed, you can sort the genuine plots from the problem properties. And with a little bit of luck in the auction room, you might well be able to snap up a genuinely good opportunity for a bargain price.
What gets sold at auction?
From conversion opportunities through to rundown bungalows and virgin plots, every kind of property can exchange hands at auction; and the dwelling or land can come onto the market for a wide variety of reasons. Increasingly, auctioneers promote their services as a quick and certain route to making a sale. This can appeal to mortgage lenders who want to sell off repossessions swiftly, but may also suit private vendors – for instance if they need the money to finance another purchase.