|How to buy property on auction|
How to buy property on auction
One of the easiest ways of earning a passive income is by investing in property, especially buy to let property. Contrary to popular opinion this is an excellent time to buy property. The recent financial turmoil has left banks with more foreclosures than they are comfortable with, and there are plenty of good bargains out there ready to be picked up at property auctions.
However before going out to take part in a property auction there are a few things that the novice should do so that when the time comes he is well prepared. It is a very good idea to go to a few property auctions as an onlooker before you take the plunge and go out to bid. There is a lot to be learned from just seeing how property auctions work, and you’ll feel far more comfortable and at ease on your actual auction day if you’ve seen what happens beforehand and you know what to expect.
Before committing yourself to your first “live” property auction, make sure that you are really ready to do so. Check with the auctioneers on whether you need to register with them beforehand – this is often the case as they will have to approve you as a buyer, and they’ll need proof of who you are, usually a copy of your identity and some proof of your address.
It is also essential that you know that you are going to be eligible for a mortgage if this is to be your route. Arrange to look over the property before the auction takes place. It would be very foolish to bid for something that you had never seen. You can always arrange for these kind of details and requirements beforehand with the auctioneers. By doing these things a few days before the auction is to take place you can avoid undue stress on the actual day of the auction.
Get hold of a copy of the auctioneers’ Conditions of Sale and study them before you take part in your first actual auction, and read them thoroughly. Conditions of Sale are very comprehensive and lay out all of the details regarding an auction sale that you will need to know. These are such things as commissions, deposits, guarantees, VAT and the many other conditions that accompany a sale. When attending property auctions with the object of buying to let, try to find out something about the area the property is in.
More affordable and entry level properties are much better prospects since tenants are much easier to find. It is also easier to get a bond on a residential property than it is on a commercial property. Auctioneering firms are generally much better at handling investment properties than estate agents, where the purchaser is usually the occupier to be.