Property Auctions in Scotland – Buyers Guide
Buying at property auctions in Scotland is becoming more and more popular. According to the recently published data, they have increased from 15,000 sales a year in 1998 to 35,000 annual sales (2019). Property auctions in Scotland are busy, well attended by the public and bidding on desirable properties can be extremely competitive.
Buying Property in Scotland
Buying property in Scotland differs from the way things are done in England and Wales. Homes for sale in Scotland are often marketed and sold by solicitors through a ‘closed bids’ system. You will often see “Offers Over” on property prices.
You settle on a fair evaluation of the property through a discussion with your solicitor after viewing details of a survey on the property. However, you do not know what bid other prospective buyers are prepared to offer and you might miss out on your dream home by falling short of a couple of hundred pounds or pay more than you had to for the property.
The main advantage of buying property in Scotland via sealed bids is that, unlike buying property in England, you cannot be “gazumped” at the last minute by a bidder who knows your offer and outbids it.
Buying Property at Auction in Scotland
By contrast, property auctions in Scotland are transparent when it comes to the bids on a property. You know exactly what others are bidding if you attend the property auction as it happens, so can increase your bid or drop out whenever you like.
If you are bidding by proxy at a Scottish property auction (allowing someone else such as the auctioneer to bid on your behalf up to a maximum amount) then you do run the danger of being outbid. This often happens with very popular types of properties, such as rural property in Scotland or buying desirable coastal property for sale.
With rocketing property prices down south, especially in the London property market, Scotland has become a popular choice for people wishing to escape the rat race and who want a better quality of life for both themselves and their families.
Local Property Auctions in Scotland:
- Property Auctions in Glasgow
- Edinburgh Property Auctions
- Property Auctions in Aberdeen
- Perth Property Auctions
- Property Auctions in Dundee
- Inverness Property Auctions
Apart from permanent relocation, others look at houses sold for auction in Scotland because they wish to buy a holiday home or are looking for a bargain property investment for rental purposes. A combination of both is possible if you wish to arrange short-term lets while your second home lies vacant.
If this is your reason for choosing to buy property in Scotland, you should make sure you understand how the LBTT (Land and Building Transaction Tax) works. This Scottish equivalent of stamp duty is liable on any second home or buy-to-let property which is worth over £40,000.
Property Auctions in Scotland - FAQ
How Much Are Auction Properties in Scotland?
The prices of auction properties in Scotland will generally be lower than the equivalent in other more populated areas of the UK. However, the catalogue guide price is not necessarily how much it will sell for as this depends on how many people are bidding on the property. It also depends on what kind of property you intend to buy.
Where can I find property auctions in Scotland?
Property auctions in Scotland are popular and there are many local auction houses located all over Scotland. You can also talk to a local solicitor and inform them you are interested in buying a property at auction. Property auctions in Scotland are commonplace and a popular way of starting a property portfolio.
Is Scottish Property Law Different to the Rest of the UK?
Property law is different in Scotland. Scotland is by legal definition a different country and although part of the UK, has its own laws, including property laws. If you are seriously considering bidding on a property being sold by auction in Scotland it would be wise to employ a Scottish legal adviser or solicitor who is familiar with the Scottish property market.
How To Find Property Auctions in Scotland
If you are interested in buying a property in a particular area of Scotland the best course of action is to deal with a local property auction house. London auction houses often have lots from across the entire UK, including Scotland, while Scottish auction houses tend to specialise in local properties.
You should ask to be added to their mailing list so you can see which new houses and flats are coming on the property market in Scotland and the local area. Checking out forthcoming houses to be sold at auction and their property guide price will give you information about how much you should expect to pay.
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If you are interested in a second home or buy-to-let property, you might not be familiar with local house market in Scotland. However much online research you do, this is no substitute for paying a visit in person to the towns and neighbourhoods you are interested in to become familiar with the area before purchasing a property in a particular part of Scotland.
Group viewings are often arranged by the auction house in Scotland at set times and days, while some property auctions in Scotland allow individual viewings by appointment.
Preparing for a Scottish Property Auction
Once you have found your ideal home among all the auction properties in Scotland on sale, it is time to do a more detailed investigation.
Another way that Scotland differs from the rest of the UK is that people selling homes in Scotland have to prepare a home report. This set of documents comprises of:
- A full property survey
- An energy report on the property
- A property questionnaire (with details of the property’s history)
Do your own research on the property
Despite being provided with a survey in this home report, it might not be as thorough as you would like. For this reason, you should arrange to have the property surveyed for any potential structural issues or underlying problems. You can even opt for a partial assessment, such as a damp survey on the property.
This is also the time to instruct a solicitor. Due to the legal differences between Scotland and the rest of the UK, it is recommended that you opt for a local solicitor in Scotland.
Not only will they have in-depth knowledge and experience of the local property market in their area of Scotland, but they will also be able to advise you about any unique conditions of sale in Scottish law in relation to property sales in Scotland.
You should also make sure that your auction property financing is in place. If you need a mortgage, you should have applied for a MIP in plenty of time. Your mortgage provider may accept the information supplied in the home report instead of carrying out a full evaluation and survey.
You should also ensure that you have 10% of your maximum bid ready as a deposit on the property. This deposit has to be paid as soon as the hammer falls on your winning bid. Do not bid on the property if you don’t have sufficient funds for the deposit.
How to Buy Auction Properties in Scotland
Property auctions in Scotland do not differ from the rest of the UK. You could attend the Scottish property auction in person, arriving in plenty of time. Check beforehand what forms of ID you need to bring with you. If you make prior arrangements with the auction house you could also bid by phone, over the internet or by proxy.
If you decide to go in person choose a seat where you have a clear view of the auctioneer as well as rival bidders. You signal your bid by raising your hand, the catalogue, or a numbered paddle or card you are given upon registration with the auction house.
If you cast the wining bid, an auction house employee will guide you through the financial arrangements and your signature on the missive (or sales contract). If you are outbid, then you will have to begin the process all over again, but with a better understanding of how to buy property for sale by auction in Scotland.