Are Property Auctions Cheaper Than Estate Agents?
One of the most common questions we are asked is are property auctions cheaper than estate agents when it comes to buying property in the UK? This question has a number of different and sometimes conflicting answers for property buyers.
Generally speaking, and ‘on paper’, if you like, property auctions are cheaper than buying through conventional means such as houses and flats marketed by estate agents in the UK. This is simply because estate agents generally sell houses at the market value, whereas property auctions in the UK tend to market and often sell property below the market value.
Saving Money At UK Property Auctions
Whether you’re a first-time home buyer or an experienced property investor, buying at a UK property auction can save you money. House prices in the UK have been on the rise in recent years, but at property auctions, you can still find deals below the market value.
Here’s what you need to know about property auctions in the UK, and how you can save money by bidding on property.
What is a property auction?
A property auction is a public sale of property, where interested buyers can place bids on the property they wish to purchase. The highest bidder wins the auction and becomes the new owner of the property.
Property auctions are held by both government agencies, banks and private companies and are a popular way to sell property in the UK.
Why buy property at auction?
One of the main reasons to buy property at auction is to get a good deal, especially when it comes to buying property in London and other expensive UK cities. Since property auctions typically attract investors and experienced buyers, the prices for properties can be lower than what you would find on the open market.
Another reason to buy property at auction is the speed of the sale. Once the property is auctioned off, the sale is typically finalized within a few weeks. This can be much faster than buying property through a real estate agent, which can often take months.
How to buy property at auction
If you’re interested in buying property at auction, there are a few things you need to do first.
First, you’ll need to find an auction that’s selling the type of property you’re interested in. UK property auctions sell everything from building plots and land, such as woodland for sale, to houses which need renovation work and even repossessed properties.
Useful property links:
- Property auctions in Scotland
- Remote property in Wales
- Buying UK coastal property
- Property auctions in Norfolk
- Cheap houses in Wales
Once you’ve found an auction, you’ll need to register to bid and keep an eye on the guide price for the property you are interested in. This usually involves providing some personal information and paying a deposit, which is typically 10% of the property’s sale price.
Then, it’s time to start bidding! If you’re the highest bidder when the auction ends, you’ll be the new owner of the property.
Buying property at auction can be a great way to get a good deal on a property. Just make sure you do your research and are prepared to bid before you register to buy.
Buying a property for sale by auction to rent out
If you’re thinking of buying a property to renovate and rent out to tenants, one option you may want to consider is buying at auction. In the UK, there are a number of auction houses that sell suitable properties, often at a reduced price due to the condition of the property or because it’s been repossessed.
However, it’s important to do your research before bidding, as you’ll need to factor in the cost of repairs and renovations. You should also be aware that auction properties are usually sold as seen, so you won’t have any recourse if there are any major problems with the property.
Nevertheless, buying a property at auction can be a great way to get your rental portfolio started. Many landlords have bought houses and flats at auction, renovated then rented the property to tenants with a tenancy agreement form.