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Anyone purchase a house from auction before ?

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TheSmiler
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PostPosted: 10:54 - 12 Jul 2017    Post subject: Anyone purchase a house from auction before ? Reply with quote

Just after some advice I'm looking at buying a house and found one that I'm verry verry tempted at. I've got a mortgage in principle offer of 100k. Now the auction is on monday so I'd have to work fast getting things in place.

This is the property below, just wondering for those that have been though the auction process before. Have you got any tips; it does look like a survey has already been done from the legal documents.


https://www.buttersjohnbee.com/property-for-sale/house-semi-detached-for-sale-in-consett-road-blurton-stoke-on-trent/6587
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Fizzoid
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PostPosted: 11:19 - 12 Jul 2017    Post subject: Reply with quote

Have you read the legal pack?

Almost always worth doing
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Ste
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PostPosted: 11:21 - 12 Jul 2017    Post subject: Reply with quote

About 10 years ago I looked at some properties being sold by auction.

As with all properties, IMO paying for a survey to be done is a waste of money as all they do is have a poke around the property and if they find anything notable / questionable then they advise you to get an appropriate expert to look at whatever it is. You can do all of what a surveyor does quite easily yourself.

Looking at external brickwork / mortar / chimney / roof tiles is self explanatory and can be done with a hi res camera, binoculars or whatever other such thing that you can get your hands on. A damp meter for testing walls inside isn't expensive. One of those plug in electrical socket tester things is equally inexpensive. Turn the heating on and check that all the radiators heat up. Test every tap is the property. Take a ladder and a torch to have a bit of a look in the roof space. (there's more points than this, it's just a quick list rather than an complete list).

You need a mortgage offer for the property which will involve them doing their own valuation of the property. If you win the auction you'd have 28 days to complete and you'd need to pay a 10% deposit if you win.

The properties at auction I was looking at with the intention of bidding on went for higher than the guide price and for higher than what they'd generally sell for in a normal sale through estate agents.

I'd quite happily look at property being sold at auction again but tbh I wouldn't be expecting to win when it came to the auction.
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stinkwheel
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PostPosted: 11:46 - 12 Jul 2017    Post subject: Reply with quote

Do an extract from the land registry.

This will tell you who owns it and how big the last mortgage was.

Often reposessions so check the inside hasn't been trashed.

They haven't included a picture of the house from the rear. I'd want to know why. With particular reference to where the conservatory joins the house itself.

The carport made as an extension of the porch roof then balanced on a single course of 6" blocks, stacked 6ft high on top of a boundry wall looks particularly shonky. Looks like I'd be able to push it over.
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TheSmiler
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PostPosted: 11:58 - 12 Jul 2017    Post subject: Reply with quote

stinkwheel wrote:
Do an extract from the land registry.

This will tell you who owns it and how big the last mortgage was.

Often reposessions so check the inside hasn't been trashed.

They haven't included a picture of the house from the rear. I'd want to know why. With particular reference to where the conservatory joins the house itself.

The carport made as an extension of the porch roof then balanced on a single course of 6" blocks, stacked 6ft high on top of a boundry wall looks particularly shonky. Looks like I'd be able to push it over.


I know someone who has been to view the property from the rear and walked around the outside. There is no reason to not take a photo but then again most property estate agents don't. They have also viewed inside it wasn't a repo it was a buy to let that the owner no longer wants.

The conservatory joins the house by th rear lounge windows that have been converted into a double door. The carport is one thing that would be possibly removed or amended with a gate being put up to secure it.

I've read the legal pack and apart from the very low possibility of coal mining subsidence there is no other problems on the property. There is a water drainage charge every year to the local water company of £56. Plus fees that the seller has occured listing it which are £240 for the surveys, £625 for auction fees and up to £100 for solicitor fees.
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Rogerborg
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PostPosted: 12:57 - 12 Jul 2017    Post subject: Reply with quote

Might have moved out because of the mahoosive construction site next door.

Go and knock on the neighbour's door and ask then what the area is like, which is a good way of finding out what they are like. That big St George cross might be a red flag, as well as a white one.
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TheSmiler
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PostPosted: 16:52 - 12 Jul 2017    Post subject: Reply with quote

Rogerborg wrote:
Might have moved out because of the mahoosive construction site next door.

Go and knock on the neighbour's door and ask then what the area is like, which is a good way of finding out what they are like. That big St George cross might be a red flag, as well as a white one.


It's no longer a construction site it's just a retirement villiage. Which might not be the most appealing thing however at least it will be quiet. I used to go to school in the area and know quite a lot of people in the area anyway.

Just working out if there is anything else I would need to do apart from read the legal pack which is done, checked the surveyor reports and speaking to a solictor tomorrow.
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Ste
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PostPosted: 16:58 - 12 Jul 2017    Post subject: Reply with quote

Have you looked round the house and done some checking of stuff?

I presume the mortgage lender knows you're looking to buy from an auction?
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Polarbear
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PostPosted: 17:19 - 12 Jul 2017    Post subject: Reply with quote

I went to buy a stables for my daughter at auction which TBH was more about the land than the buildings on it. Guide price was £25000. It went for £49000. I pulled out at £45000.

I have been to a few auctions since and the guide price in all of them was crap. That was the starting price. Some even had a reserve higher than the guide price with is something not allowed in antiques auctions.

You have to be able to go view at the drop of a hat. Some auction houses have a open day/evening and thats it. Others have given me the key and let me go and look myself but that's a rarity. Also it cost me quite a bit in solicitors fees for a fast check into some things in legal packs I wasn't happy with.

However after saying all that I still have never actually bought a place at auction. Also when I was looking I didn't need a mortgage so I can't say what grief you would get off the bank. I can't see them being very happy without a survey and their own valuation though.
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M.C
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PostPosted: 17:28 - 12 Jul 2017    Post subject: Reply with quote

Polarbear wrote:
I have been to a few auctions since and the guide price in all of them was crap. That was the starting price.

Noticed that myself. It's annoying when you're trying to work out what you can and can't afford. Good old stoke, I know someone who bought a house there (at auction) 15 years back for 25k IIRC. I assume homes under the hammer has turned everyone into wannabe property developers now, and they'll be a lot of competition.
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Ste
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PostPosted: 17:42 - 12 Jul 2017    Post subject: Reply with quote

Polarbear wrote:
I can't see them being very happy without a survey and their own valuation though.

They won't be the ones paying a 10% deposit and signing contracts to say he'll complete in 28 days time. Laughing

I'd be some what cautious about bidding when only having an offer in principle simply because of the hassle and expense Smiler will have if the mortgage offer in principle didn't work out.

Smiler, have you talked with the auction house / estate agents about bidding when you'd be getting a mortgage?
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TheSmiler
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PostPosted: 18:58 - 12 Jul 2017    Post subject: Reply with quote

Ste wrote:
Polarbear wrote:
I can't see them being very happy without a survey and their own valuation though.

They won't be the ones paying a 10% deposit and signing contracts to say he'll complete in 28 days time. Laughing

I'd be some what cautious about bidding when only having an offer in principle simply because of the hassle and expense Smiler will have if the mortgage offer in principle didn't work out.

Smiler, have you talked with the auction house / estate agents about bidding when you'd be getting a mortgage?


They have told me as long as I've got the mortgage in principle they are happy enough, I've been up today to have a look around at the house it's decent to be honest for a starter home. Could do with a fence putting up and the car porch sorting out but apart from that it's pretty much good.

It's also got a converted loft so pretty much an extra bedroom right there. They have told me as well if I phone them the day after the auction if it doesn't sell (which is very unlikely) then I can go through the normal route.
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Ste
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PostPosted: 19:06 - 12 Jul 2017    Post subject: Reply with quote

Things like the boiler, the heating, the electrics and the plumbing are more important than a garden fence. Wink

Is the converted loft being 'sold' as living space and if so does it have building regulations approval?
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TheSmiler
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PostPosted: 19:08 - 12 Jul 2017    Post subject: Reply with quote

Ste wrote:
Things like the boiler, the heating, the electrics and the plumbing are more important than a garden fence. Wink

Is the converted loft being 'sold' as living space and if so does it have building regulations approval?


It has building regulation approval, the boiler and electrics are fine the boiler might need replacing in the future for something more economically friendly.
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P.
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PostPosted: 19:44 - 12 Jul 2017    Post subject: Reply with quote

Doesn't mean they are fine.

You really need to look at it in person to get 100% confirmation. I've looked at 2 places which were all the top area of 180k and boy... You could live in there but it was dire and all were listed as habitable Laughing
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M.C
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PostPosted: 20:05 - 12 Jul 2017    Post subject: Reply with quote

Ste wrote:
Is the converted loft being 'sold' as growing space and if so does it have lighting and ventilation?

FTFY Wink
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angryjonny
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PostPosted: 10:12 - 13 Jul 2017    Post subject: Reply with quote

Two immediate reasons occur to me why a property might be in an auction rather than an estate agent's window.

1. It's a shithole and impossible to sell by any other means
2. It been repossessed

If 1 is not true then I'd be worried about 2. If the previous owners hadn't kept up payments on the house, there are probably 101 other things they hadn't kept up payments on too. Expect visits from Ramone and Knuckles to rearrange your furniture on a weekly basis for the first year or so.
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Polarbear
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PostPosted: 10:20 - 13 Jul 2017    Post subject: Reply with quote

Teffers post coming - sorry.

That £54000 I presume is the guide price?

I don't know the prices of houses up north and can't be arsed to google, but I would chuck £54000 at that without worrying about the boiler etc. That's relative peanuts to fix.

However if £54000 is the guide price in my experience you can add £20000 to that for a final figure with fees on top. Then it becomes a bit more serious and your repair budget more stretched.

You need to think like a developer in that they want to buy, do up and flog on to make the most money. You want to buy and keep so you are going to have to outbid the developers. Find out what a similar house in good condition goes for, if it's £100000 a developer will not want to spend more than 65/70 grand plus a doing up budget of 10k to get a profit of 20% less tax.

Bear in mind what it would cost you to do the place up and halve it for a professional developer, they have contacts and workforces.

And probably most important thing, if you can find out, is why is it being auctioned. A repossession, fine. A seller desperate for money, fine A desperate seller because there is structural faults, not fine. There is a lot of homework to do, a lot of searches, checking other houses in the street etc. The internet is good for this though, imagine trying to do it a few years ago without it.

And the bank. Go face to face with a mortgage person at the bank and tell him what you plan to do. See what guarantees they want. Get it in writing they are in agreement and will lend you the money if you buy at auction. If they withdraw and you haven't the funds, you are royally fucked. The auction house won't care, they just want your bid and the fees, it's not their problem if you can't pay.

Finally be prepared to fork out money to get answers. You need a fund you know you will have to squander with no guarantees of suitable results, down to buying the next door neighbour a bunch of flowers for telling you all about next door and it's occupants. Thumbs Up
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Minty
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PostPosted: 10:35 - 13 Jul 2017    Post subject: Reply with quote

22 Consett Road, Stoke-On-Trent, ST3 3EA
Sold price Date Change Annual change ?
£49,950 14 Aug 03 - -

Valuation: ? £95,900
Value range: ? £86,000 to £105,000




32 Consett Road, Stoke-On-Trent, ST3 3EA
Sold price Date Change Annual change ?
£67,500 13 May 11
£59,300 01 Apr 11 - -
Valuation: ? £84,700
Value range: ? £75,000 to £94,000


Value in that road looks to be £75k and above.
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Polarbear
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PostPosted: 10:43 - 13 Jul 2017    Post subject: Reply with quote

If they sell for 75k I wouldn't want to pay more than 60k so maybe that 59k figure is legit Shocked I'm shocked Laughing

Any more than that you might as well pay the price and buy normally with a full survey etc.
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ScaredyCat
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PostPosted: 11:34 - 13 Jul 2017    Post subject: Reply with quote

Neighbour with 2 flagpoles that fly the St George's Cross would set off alarm bells in my brain.
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MarJay
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PostPosted: 12:02 - 13 Jul 2017    Post subject: Reply with quote

Sorry Sammy but knowing you and knowing the pitfalls of house buying plus the pitfalls of buying at auction, with all the short timescales and so on... I can't see this ending well.

As mentioned nobody in the industry is your friend, nobody with a vested interest in selling the property will hold your hand through this. You have to do the leg work yourself (forgive the change in metaphor!).

As mentioned building reg compliance does not mean 'fine'. A survey does not mean a property is livable. This is a massive life event and if you mess up it could have repercussions for the rest of your life.

Do not rush into this.
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TheSmiler
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PostPosted: 12:25 - 13 Jul 2017    Post subject: Reply with quote

Polarbear wrote:
If they sell for 75k I wouldn't want to pay more than 60k so maybe that 59k figure is legit Shocked I'm shocked Laughing

Any more than that you might as well pay the price and buy normally with a full survey etc.


Thank you for the tef post it was interesting and informative,

If I had gone to the estate agents 3 weeks ago they told me I could have put an offer in and they would have taken it out of the auction. I'm going to see the mortgage advisor today to do an application to see how it goes; he is going to do it for the maximum with a few grand leaway.

The thing is I could ignore the auction and hope that it doesn't sell and then go through the normal route; however if it does sell for say 55k I'd be kicking myself.

ScaredyCat wrote:
Neighbour with 2 flagpoles that fly the St George's Cross would set off alarm bells in my brain.


I've already met with the neighbour he seems decent in the area they are very patriotic. When I was younger they used to have the flags up for celebrating the queens birthday.

I don't really go out and mess a lot with neighbours so it doesn't bother me that much really. In this part of the midlands a lot of the area is patriotic. Keep to yourself and that doesn't matter though.
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dodsi
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PostPosted: 13:08 - 13 Jul 2017    Post subject: Reply with quote

TheSmiler wrote:
There is a water drainage charge every year to the local water company of £56.


This is nearly always the case for nearly every property - it only depends which water company you would pay the bill to.
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Polarbear
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PostPosted: 13:31 - 13 Jul 2017    Post subject: Reply with quote

TheSmiler wrote:

The thing is I could ignore the auction and hope that it doesn't sell and then go through the normal route; however if it does sell for say 55k I'd be kicking myself.



It will sell. Unless there is a stupid reserve it will sell. 50k is small change to a lot of developers, rental landlords and the like. Someone at the auction will bid on it because they are there and no one has.
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