Auction

sandra_b

Hi, could someone explain what does auction mean? I understand there are usually problems with that property. But is there any viewing before the auction? Do you need to give deposit and sign a contract on the auction? How would someone make a decision like that before investigation of the property through solicitor?

myshirt

Go to any of the auctioneer websites and they will give you a guide you can read to give you a flavour.

An auction doesn't mean there is anything wrong with the property. Many properties go to auction from many different backgrounds. It is just one of a list of traditional sales strategies.

You can view the property in advance or buy as is. Your solicitor can enquire before you bid as the vendor solicitor (and vendor) will have done a lot of legwork and will have answers to the standard questions ready.

Usually a property at auction is more sale ready than any property, and I don't just mean the warts and all properties.

You may have to pay a booking deposit before you get your paddle, and you should have your solicitors details printed out and in your arse pocket.

sandra_b

myshirt wrote: »

You may have to pay a booking deposit before you get your paddle, and you should have your solicitors details printed out and in your arse pocket.

Is that 10% deposit which is not refundable?

wirelessdude01

In Galway city for example most properties are sold via auction. None of this counter bidding nonsense where nobody knows if bids are real or figments of the agents imagination.

Graham

Generally:

At an auction you're usually expected to lodge a few thousand with the auctioneer before you're permitted to bid.

If you don't win/bid, the deposit is returned to you.

If you do win, you're all in. No option to pull out. No reductions based on surveyors reports or the like. 28 days to pay the balance.

myshirt

Good point Graham. Op, do make sure that you are ready to complete within the agreed timeframe, 4 to 6 weeks.

We sold a red brick property in Clontarf at auction and the girl paid 60k deposit, but needed an extra 3 weeks to complete as the bank had queries. I told the client to agree, but to no more than that. The client did not agree. The girl lost her deposit. 60k. Felt very sorry for her.

Jake2

myshirt wrote: »

Good point Graham. Op, do make sure that you are ready to complete within the agreed timeframe, 4 to 6 weeks.

We sold a red brick property in Clontarf at auction and the girl paid 60k deposit, but needed an extra 3 weeks to complete as the bank had queries. I told the client to agree, but to no more than that. The client did not agree. The girl lost her deposit. 60k. Felt very sorry for her.

Jesus Christ 60k!!! Why because she couldnt close in the timeframe? That seems harsh

davo10

Op, unless you know precisely what you are doing, do not bid at auction, it is not for the uninformed.

If you bid at auction.

• your finance must be in place, if you are the winning bid the purchase is not subject to mortgage approval, the contract of sale is formed on the day and you must complete the purchase.

• you will have to lodge a hefty deposit on the day of the auction, unlike other property sales where you can pull out and get a refund before completion, if you pull out here you lose your deposit.

• when you buy at auction, the property is yours, warts and all, if it's a run down rat infested shack, it's your shack now. The only time that doesn't apply is if it was falsely advertised or not as described at auction.

• if you want to view before auction, you can, if you are going to bid, get a survey, if you don't get a survey and you are the winning bid, the sale is not subject to survey. Therefore if you find afterwards that it is falling down, tough luck, if they haven't made any false claims about its condition, then it's your pile of stones.

• get legal advice before you bid, and if you can, bring someone with experience of auctions with you. Auctions can be great for bargains but complete disasters for novices.

Graham

Jake2 wrote: »

Jesus Christ 60k!!! Why because she couldnt close in the timeframe? That seems harsh

Warnings are not hard to come by when you get into the realms of auctions.

Do not bid if you are not in a position to complete within the timeframes very clearly stated.

davo10

Jake2 wrote: »

Jesus Christ 60k!!! Why because she couldnt close in the timeframe? That seems harsh

Auctions are not for the feint hearted and the rules are there for a reason. The underbidder may have been a cash buyer so the vendor lost out on the sale at auction.

Jake2

davo10 wrote: »

Auctions are not for the feint hearted and the rules are there for a reason. The underbidder may have been a cash buyer so the vendor lost out on the sale at auction.

Her own stupidity so, bet she never bid at auction again!!:eek:

sandra_b

Thank you all ðŸ˜႒ Is the price stated for the apartment/house at auction minimum asking price? Is it possible to bid below that ( if noone else is interested) ?

LirW

If you're going to an Auction with an EA that's probably just sales strategy.

If you think about buying in an Allsop auction, they indeed do sell distressed properties. They have open viewings and all the legal paperwork online, engage your solicitor to check this VERY well. There could be problems with title, Safety issues and a variety of other things that could cause problems. Also have your bank on board, nothing worse than winning and the bank refusing to lend for some reason, you'll lose your deposit.

Basically once the hammer goes down, it's yours. All the paperwork gives you the direction of the sale, so when you're going to close and you need to be within that.

Regarding price, there is a minimum that'll be called. You can't go under that. It usually starts under the reserved price, if the final bid is under that it's up to the vendor to decide if he wants to sell or withdraw.

Again be a million percent sure about your finances and what's the max you'd spend. Get a survey done (that can only be done during an open viewing so the engineer needs to be prepared for that) and work through the papers with a solicitor.

Graham

sandra_b wrote: »

Thank you all ðŸ˜႒ Is the price stated for the apartment/house at auction minimum asking price? Is it possible to bid below that ( if noone else is interested) ?

The property will usually have a reserve price which usually isn't made public.

Maximum bid above the reserve wins.

If you bid below the reserve you will either get an outright no, or the auctioneer may revert back to the seller to consider your offer.

The chances of you finding a bargain property that nobody else is interested in are fairly slim. In my own observations recently, properties are often selling at double or more the price being marketed.