X

Sign Up

or

By signing up I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Sign Up

Sign Up With Facebook, Twitter, or Google

or


By signing up, I agree to Property Tribes Terms and Conditions


Already a PT member? Log In

Log In

or


Don't have an account? Sign Up

Forgot Password

To reset your password just enter the email address you registered with and we'll send you a link to access a new password.


Already a PT member? Log In

Don't have an account? Sign Up

  • Auction Tribe

    Buying at auction - all that glitters isn't gold

    I have been researching and analyzing the subject of buying properties at auction for quite some time now. I have not bought anything yet, but I'd like to share my findings to date.

    After reading many interesting stories on this site (including the fascinating epic about Paul Ribbon's strategy) I initially had 2 concerns about the auction practices in general:
    1) was about those properties which were doing rounds from one auction room to another. While I could certainly observe these "gems" occasionally popping up here and there, there was no system that made it possible to actually see the performance of any given property in the past auction. Sure, Land Registry data helps to some extent but if a property gets flipped immediately back through auction, there is very limited visibility.
    2) some properties are withdrawn from the auction brochures leaving no trace what the initial guide price was. An auctioneer would just put "Sold Prior" or "Withdrawn" by replacing the original guide price. If such property ever came up again at a later auction I would have no clue whether a newly quoted guide price was fair. Unless, of course, I had kept the initial brochure. Otherwise I was left at the mercy of my own DD (which isn't perfect at the moment and might cost very dearly).

    I discovered that I could relatively easily address both of my concerns by actually recording all delta movements prior to auction dates. The principle is similar to what used to be propertysnake. I thought that by taking snapshots I would be able to keep track of
    (a) the entry point of a property at an auction;
    (b) its interim movements. It became obvious that any amendments to the guide price or upward/downward adjustments could give away some sentimental directional hints;
    © exit point such as "sold at xyz price" or "unsold still available at ..." or "withdrawn".

    My system isn't perfect yet as I'm still working on it, but boy could I already spot real "pearls" (which I personally would not touch with a barge pole). Like these couple of examples:
    1) 357A Victoria Park Road, Homerton, London, E9 5DX
    Auction----- Date-- Lot---- Price
    Barnard Marcus 15/12/2015 73 Guide price £80,000
    Barnard Marcus 10/03/2015 29 Sold for £122,500
    Barnard Marcus 02/02/2015 54 Sold for £141,000
    Allsop Residential 30/10/2014 200 Sold for £100,000

    2) Land at 61 Invicta Road, Blackheath, London, SE3 7HD
    Allsop Residential 26/03/2015 78 Sold Prior
    Allsop Residential 26/03/2015 78 Guide £150,000 Plus
    Savills 17/02/2015 196 There were no bids but is available at £160,000
    Barnard Marcus 16/12/2014 33 Sold Prior to auction, for an undisclosed amount.
    Barnard Marcus 17/11/2014 85 Sold for £237,000

    I would definitely think twice next time I'm at the auction room and prior to making any auction bids, really.

    I still wonder what the first property will go for at the upcoming auction on 15/12/2015. The guide price is £80K. Maybe it will sell again for £100K and then back onto a see-saw ride? Or perhaps it won't sell at all and we will see it back at the next round starting at £60K? I guess everything has its fair price. It's just I would not want to be that sucker who paid £141K and then sold it for £122.5K next month! There are tons of similar stories going on all over the UK at the moment. It's incredibly sobering and really mind blowing how people buy properties sometimes. You quickly become aware that you do REALLY need to know what you're doing.

    On the other hand, as I discover, it isn't all doom and gloom as there have been certainly some truly outstanding items passing through the auctioneers' books. My open question is how to find them systematically. Through deep local knowledge, sheer experience and gut feeling??? In the past I developed a system on eBay that analyzed billions of auctions. This allowed me to purchase quite a number of incredibly mispriced items. While I appreciate that the property game isn't like buying a mobile phone or a pair of Church's off eBay, I trust that the underlying principle is the same. This whole thing needs proper data gathering, data crunching and modeling, then followed by action. Before jumping into action, and in order not to reinvent the wheel, may I ask if you're familiar with any services out there (apart from paid data compiled by EIG) which already offer such analytical solutions please?

    Thanking you in advance.
    1
    0
    (08-12-2015 03:35 AM)ipsy_dipsy Wrote:  My open question is how to find them systematically. Through deep local knowledge, sheer experience and gut feeling???

    I believe this to be the case. Its the ability to spot a gem and be in the right place at the right time and have also a combination and variety of associated and interlinked factors coming all together at once. This may occur sometimes frequently or infrequently. Rolf De Roos says the deal of the decade comes along every week. He is right. Your job is to seek out that deal though. That`s the hard part. But you have to have deep local knowledge to then become a specialist in house pricing. It is no coincidence that i have bought 7 properties in one street alone.

    I dont buy at auctions but through estate agents and sometimes through private networks. You see this mis pricing all the time and my job as a vulture is to seek these odd gems out. It is 10 times more difficut now than when I started because now you have the internet and anyone can become an expert with relative ease. You just have to refine your art further though.

    In 2012 I recall buying a four bed house for a bargain 100K through an agent. I couldnt understand why no one else had bought it. It yielded 12% . There was another virtually identical property though on the market at the same time being auctioned. Its guide price was only 75K. I knew my market though and knew 100K for mine was good value and went through to completion before the auction was held. Had I paid too much. The doubt crept in

    I watched the auction price. It went for 101K in the end. My decision was vindicated.
    Both were great bargains. That was in 2012. I`ve seen a similar one just go for 165K. That`s 65% growth in 3 years. That will do for me.

    I would say yes be robotically systematic about your knowledge on your chosen subject matter. If you spread this too thinly countrywide there are not enough hours in the day to keep a handle on it in my view. Get too know 10 streets locally to you. Be a mastermind specialist in those 10 streets. No one will have as much knowledge about those streets as you then. You can use that to your advantage

    Aim to be a mastermind specialist.
    .
    1
    0

    Jonathan Clarke. https://www.buytoletmk.com


    (08-12-2015 05:19 AM)Jonathan Clarke Wrote:  
    (08-12-2015 03:35 AM)ipsy_dipsy Wrote:  My open question is how to find them systematically. Through deep local knowledge, sheer experience and gut feeling???

    I believe this to be the case. Its the ability to spot a gem and be in the right place at the right time and have also a combination and variety of associated and interlinked factors coming all together at once. This may occur sometimes frequently or infrequently. Rolf De Roos says the deal of the decade comes along every week. He is right. Your job is to seek out that deal though. That`s the hard part. But you have to have deep local knowledge to then become a specialist in house pricing. It is no coincidence that i have bought 7 properties in one street alone.

    I dont buy at auctions but through estate agents and sometimes through private networks. You see this mis pricing all the time and my job as a vulture is to seek these odd gems out. It is 10 times more difficut now than when I started because now you have the internet and anyone can become an expert with relative ease. You just have to refine your art further though.

    In 2012 I recall buying a four bed house for a bargain 100K through an agent. I couldnt understand why no one else had bought it. It yielded 12% . There was another virtually identical property though on the market at the same time being auctioned. Its guide price was only 75K. I knew my market though and knew 100K for mine was good value and went through to completion before the auction was held. Had I paid too much. The doubt crept in

    I watched the auction price. It went for 101K in the end. My decision was vindicated.
    Both were great bargains. That was in 2012. I`ve seen a similar one just go for 165K. That`s 65% growth in 3 years. That will do for me.

    I would say yes be robotically systematic about your knowledge on your chosen subject matter. If you spread this too thinly countrywide there are not enough hours in the day to keep a handle on it in my view. Get too know 10 streets locally to you. Be a mastermind specialist in those 10 streets. No one will have as much knowledge about those streets as you then. You can use that to your advantage

    Aim to be a mastermind specialist.
    .

    Hi Jonathan,

    First of all, thank you for taking time and replying to this post at 04:19AM! Let me please join the ranks and publicly admit that I'm your secret admirer. I have read and re-read many of your posts and I hope I managed to pick up a lot of your KISS tips. Therefore many thanks for being so open and sharing so much useful information on Vanessa&Nick's site. This is invaluable for the beginners.

    While I completely agree with all of your points and I'm fully aware of your "10 streets" strategy, I honestly believe there could be something more to it. Partly, I think the answer lies within your phrase "It is 10 times more difficut now than when I started because now you have the internet and anyone can become an expert with relative ease". Indeed, with the invent of technology we are truly seeing the effect "when one door closes another one opens". We are awash with the information nowadays, the question is how to structure it correctly in order to be able to sift through the noise and get to the bottom of it, so to speak. I like what Hometrack is doing, but I still think the human race is at the very early stages of Big Data analysis.

    You have brought up a very good example, Jonathan. Guided by your sheer knowledge, local experience, a mix of chutzpah and a fair bit of luck you managed to identify and exploit the opportunity of buying a mispriced piece. While nothing can yet replace the way of how a living human being comes to its conclusion, I still think that even the most complex issue can be broken down to the series of very basic binomial choices. Effectively, by constructing and following this decision making tree it is possible for a machine to programmatically follow human logic and do it 1000 times better and faster. The real key question is how to get inside an expert's head and then unwind the logic of a decision making person (by reading and re-reading these posts, I guess).

    Let me give you an example: you say that you put an eye on £100k property which was yielding 12%. In my world 12% is a result of a simple formula which can be relatively easily calculated with some degree of precision by collecting relevant data on local sales and rents. You mentioned that you also checked prices at the local auction - I have detailed earlier that this part of data analysis can be also brought in into the model. You had an amazing 65% capital growth rate in 3 years - perfect, but how much of that is down to "rising tide lifts all boats"? Because I'm convinced there are more sophisticated and scientific ways of figuring out what the next up-and-coming areas might be. I guess in other words what I'm trying to say here is that "10 streets" strategy is something that is probably at the limits of what's realistically possible for a mere human being to do manually. But would you not have this itchy feeling if that "deal of the decade" was just round the corner, or on 11th street that you don't cover? While I completely see your point that spreading yourself thinly will not give you enough time to concentrate on what really matters. But I'm just questioning "what if". What if the machine does this analysis for me and spits out only those properties which pass my initially pre-set threshold tests? I would then be able to concentrate only on those very specific items one at a time. I sincerely hope that by raising these simple what-if questions I start wondering and exploring different avenues and see where these path lead me.

    You see, another obstacle, as you may hear from many of those living in London, is that anything even in the radius of 10 streets might lie beyond your level of affordability. Basically, if you're interested in property you're forced to start looking outside of M25 (unless of course you have nothing to worry about by buying an eye-wateringly priced property in London, but that's another cup of tea). Then, the natural question is how do you become a real expert of an area without actually be present there? I have tons of ideas and I'm currently working on replicating strategies of successful property entrepreneurs, including yourself, Jonathan. So yet again, big thank you to the members on this forum.

    The silver lining always is.... what one man can do another can do!

    (08-12-2015 10:47 AM)Vanessa Warwick Wrote:  Thanks for such an interesting and thoughtful post!

    It does highlight why the anagram of auction is "caution".

    The thing about auctions is that they have a hefty dose of emotion thrown in and this can make them very unpredictable.

    It all depends who is in the room on the day and how much self-control they have imho.

    People are known to get carried away.

    I believe that auctions are for experienced investors only who know their area like the back of their hand, and have done INTENSE due diligence including getting the auction pack looked at by a solicitor.

    Properties are put in auctions for many reasons, some of them legitimate, some of them sinister. The unwary can be easily caught out.

    One trick sellers use is to put the property into an auction a long way away from where it is located, because they know the locals won't fall for it if it was in a local auction.

    The vendor hopes that someone who hasn't done much DD will get carried away.

    I think many auction houses published reports, but other than that, I don't really know of any other source of auction data.

    Absolutely, the emotional part of buying any property (through auction or otherwise) must be completely eliminated (or at least minimized) from the decision making process. I have seen it during my days working in real estate how many people got themselves into troubles by buying on emotions. Remaining cool headed is key in this.

    Yes, by reading what others practice at the auctions, you learn a lot about nasty tricks and gimmicks. I think partly it explains why 12 months on and I'm still exploring the intricacies and testing the water. Having said that, however, by looking at what, for instance, Richard Greenland is doing gives you a lot of hope!

    Agree with you, Vanessa, one of the discovered tricks is for a vendor to put property into London's auction hoping that some wealthy (read: stupid) individual would fall for it. Again, my system would track these "gems" down.

    I would love to test my assumptions, so if anyone is currently thinking of buying through auction, I'd be glad to have a quick check for you. Please PM me.

    (08-12-2015 02:37 PM)Landlord Geoff Wrote:  ipsy_dipsy Wrote:
    My open question is how to find them systematically. Through deep local knowledge, sheer experience and gut feeling???

    Agreed.However, as individuals we all have differing opinions to VALUE. Jonathan had his and his experience won the day.

    A few weeks ago I viewed a house with a guide of circa. 100K. Having viewed it, I decided I wouldn't touch it with a bargepole. It sold for 140K at auction, plus the extras. You would need to ask the buyer how he/she reached that valuation.

    Your example 2: It could be that the first sale did not complete and therefore was immediately put in the next auction (the history you show suggests 237K was crazy)

    Totally. Each to their own or so they say. It's inevitable fact of life that many people will arrive to many different conclusions on valuation of a single property. It's just I'm a big proponent of separating the chaff from the wheat before going any further. Or put it differently, not to be that sucker who lost his money by either not completing on example 2 (that's minus £24K deposit down the drain - ouch!) or even worse by actually completing and reselling it (that's more like minus £80K - BIG OUCH!)
    0
    0

    (08-12-2015 02:48 PM)ipsy_dipsy Wrote:  I still think that even the most complex issue can be broken down to the series of very basic binomial choices. Effectively, by constructing and following this decision making tree it is possible for a machine to programmatically follow human logic and do it 1000 times better and faster. The real key question is how to get inside an expert's head and then unwind the logic of a decision making person (by reading and re-reading these posts, I guess).

    Doh . Sorry but I have to disagree . And sorry to have to say that after the nice things you said about me.

    I was once paid £100 an hour by a guy for him to get into my head to do what you want to do. He thought computer logic superceded human mindset. He made me sign a non disclosure agreement because he felt the answers i gave would be gold dust and assist him in developing this perfect property buying model from which he would make his own fortune. Its impossible in my view. The infinite variables are just too great. Not because my brain is that brilliant and complex. Everyone's is if only they apply it in a focused manner.

    Logical programming of certain aspects i agree can help but I put this at maybe 50% .
    The remaining 50% is to be found in the individual themselves and is a mixture of the personal traits you mention I may possess. I have talked to maybe 250 people to give advice over the last 5 years. They nearly all have the ability to programme the factual stuff into their mind and sift through it if time allows.

    But only a dozen or so have the remaining human 50% skill to compliment their factual knowledge and put theory into practice. Some surprise me which shows we are often like icebergs and many of our strengths lie below the surface revealed only to a few close friends and family

    Take sport. Take cricket. Take a world class fast bowler. Hundreds of fast bowlers exist that can run up to a wicket roll their arm over a shoulder and chuck down a cricket ball. I can do that. Why is it then that Jimmy Anderson can do it 100 times better than me. Analyse his movements , the way he holds the ball, his run up , his delivery stance all day long. That`s the easy part. Getting though someone else to replicate what he does it is very very hard. Thats the 50% Human element, He just knows how to do it. It all comes together at exactly the right time. A minor slip up and he will be hit for six just like the average bowler would be

    But hey give me a simple example maybe of something that you feel can be programmed out of human logic which would help a novice property investor become a great property investor and we can bat around some ideas ( pun intended)
    .
    0
    0

    Jonathan Clarke. https://www.buytoletmk.com


    (08-12-2015 07:06 PM)Jonathan Clarke Wrote:  Doh . Sorry but I have to disagree . And sorry to have to say that after the nice things you said about me.

    Jonathan,

    First, although people like me are lurking in the shadows by only reading these forums, I'd like to believe that by now I'm pretty much familiar with your style to understand where you're making a valid point. Here you're putting across a number of very valid points, so definitely no offence taken. Secondly, we are grown up adults here and the whole point of these discussions is, as usual, to get to the common denominator. So thank you for disagreeing for starters as it shows that you're genuine and have your point of view with solid reasoning behind.

    My apologies if I disappoint you, but I can't even think of partying with 100-quid-an-hour to pay for picking on your brain because I don't really need to. And the only reason why I believe I don't need to is because I'm already there, i.e. inside your head. As well as hundreds of other very smart heads on this forum. That's the whole point of having such forum, isn't it?

    If I may elaborate further. Whenever I mention of me trying to replicate your logic I don't mean to replace a human being and completely eliminate him/her from the thinking process (human race isn't there yet, anyway). Merely I'm a big proponent of creating an enhancement tool that would make me advantageously stronger and more agile when it comes to facing other "vultures". I think you would agree that if I have a better spear, I would be regarded as better equipped compared to other "hunters" (as Richard Greenland prefers to call himself). I completely agree with your point that you just have to constantly refine your art and evolve otherwise you become a dinosaur, and we all know what happened to these creatures.

    There are certainly different hunter techniques and different types of hunters. Some possess natural traits, some don't. Some are lazy and fat, others are self-motivators. Some are icebergs, others are open and flat like a palm. Go figure! I would absolutely agree that finding those core inner strengths which make you comparatively more competitive is an extremely important task in anyone's life. However, back to your point on sport I think there are thousands of better cricketers than Jimmy Anderson walking on the face of Earth. It's just they have never been given a chance, or they were born in a wrong country, etc. It's all about chances and our abilities and willingness to act on them.

    Unfortunately, as I learn, there are no easy shortcuts in property or any other business activities. Hence, I'm afraid I'm not in position to give you off the cuff quick and easy recipe for success (let alone a pre-programmed pathway from rugs to riches!). What I'm merely trying to do is probably equipping a novice investor such as myself with a good spear tool. And if you were to ask me, the very first word of advice I would say to such novice investor "Watch and learn what the greatest minds have done before you and then don't be afraid to follow their steps. Gather up and consolidate your strengths and then you must have guts to test your strengths and put them into practice when the right time comes". Or put it simply, cheer up, life is great!

    As a side note, I'm convinced that absolutely everything can be pre-programmed with some degree of precision and approximation. This must be possible simply because I'm 100% in agreement with you - we are just mere predictable human beings, our brains are only complex to a degree, and all our actions have finite scope of variations and possibilities. My conclusion is that although the infinite variables in property buying are, indeed, just too great, I'm however not suggesting to boil the ocean, so to speak. One step at a time.... now it's time to work on sharpening up those proverbial spears. We'll cross that bridge when we get there Angel

    (08-12-2015 07:06 PM)Jonathan Clarke Wrote:  I was once paid £100 an hour by a guy for him to get into my head to do what you want to do. He thought computer logic superceded human mindset. He made me sign a non disclosure agreement because he felt the answers i gave would be gold dust and assist him in developing this perfect property buying model from which he would make his own fortune.

    Jonathan, any chance of passing this thread details to that IT-geeky guy? I wonder if he could perhaps chime in and articulate his point of view on this matter? Or maybe who knows, he could not be bothered as in the end he could have used your knowledge and then found his "gold dust" and now sipping his Pina Colada on Bahamas, huh? Big Grin

    Jokes aside, it would be really nice to hook up with such like-minded individuals. And I would seriously appreciate if you could get us in touch with each other, if that won't cause a lot of inconveniences. I'm always on a lookout for those guys who are interested in data analysis as well as properties.
    0
    0

    (09-12-2015 12:06 AM)ipsy_dipsy Wrote:  However, back to your point on sport I think there are thousands of better cricketers than Jimmy Anderson walking on the face of Earth. It's just they have never been given a chance, or they were born in a wrong country, etc. It's all about chances and our abilities and willingness to act on them.

    That does not make sense. One of the reasons Jimmy Anderson is so good is that he has had had the chance to practise a lot and gain experience. There may be thousands who have the potential to be better, but without the chance to learn they will be no where near as good.
    0
    0
    (09-12-2015 11:36 AM)peter@pjackson.demon.co.uk Wrote:  That does not make sense. One of the reasons Jimmy Anderson is so good is that he has had had the chance to practise a lot and gain experience. There may be thousands who have the potential to be better, but without the chance to learn they will be no where near as good.

    Sorry, I think we are mixing up a lot of concepts in one thread. By bringing up sport I think we have obscured the underlying point of trying to get to what makes one individual great at doing what he/she is doing related to properties. First of all, I sense we are all taking the same view on this matter. In nutshell, that is that absolutely NOTHING can yet replace real life human experience. It's just we are seeing it through our own lenses. We might even assign different %-ages as to what portion contributes to automated pre-programmed logic vs what's down to individual choice (that's 50/50 split according to Jonathan). However, let's agree that we are all roughly on the same page here.

    Coming back to the initial topic on property, or specifically what makes Jonathan, for example, good at dealing with property. One, he earned his stripes and gained his knowledge and experience via different avenues in life. He was "sharpening up his spears" up until he was 40 and then became comfortable to practice what he preached only when he felt he was 100% ready. I'm pretty sure he was dead-scared to remortage his family home in order to dip his toes into BTL business. He did it, he proved his worth, he put his theory into practice and in the end this is what counts. I only know this too well, because I'm going through the same ordeal at the moment and I think twice, checking and counter-checking my theories. Only time will tell whether you were right or you were totally off. But hey, that's the whole point of living! I hope with a bit of luck everything will fall into a right place. Speaking about luck, however uncomfortable this might sound to Jonathan et all, the proclaimed 3-year 65% capital growth is mostly down to luck. Admittedly, this luck goes on a large scale for the entire country. And yes, admittedly and however shamefully, I'm hoping to take part in this frenzy. But let's not underestimate the element of luck here because on the back of Jonathan's mind, I presume, he also keeps a warm thought that if today was 1990, then these +65% would have easily turned into more like -65%. Many smart people burnt their fingers back then. I'm not being pessimistic, don't get me wrong - rather trying to think objectively and pragmatically. Yes, you need to build up your defenses against eventualities and this is all part of your overall strategy.

    Two, experience without practice counts for nothing. And I completely agree with you that if Jimmy Anderson never practiced his skills he would have gotten nowhere. What I'm trying to add here, though, is that there are many more greater cricketers than Jimmy - they are simply not aware of it yet. In order to seek out and reveal these gems we just need to use different techniques and tools, that's all. Going back to Jonathan's example, despite him being so good at spotting mispriced items, having a very healthy trackrecord of 40+ pieces under his belt, and really staying on top of his perfectly fine-tuned 10-streets strategy, I think Jonathan, if he is still humble, would agree with us that he still has got a long way to go in reaching, say, Warren Buffet's heights? That's not to offend Jonathan in any way as I sincerely and deeply respect this man. I guess all is relative in a way.

    Three, in my personal experience chances in life are such thing that come and go. They surround us everywhere, every single minute. What's most difficult, though, is to spot them and then focus on them so to be able to develop them into our competitive edge. Constant daily bombarding with new updated information doesn't help as it's becoming really hard to concentrate. Unless you tell me otherwise, I don't know any better way than HARD GRAFT to reach your desired destination. Again, in relation to our specific topic on property the hard graft for a newbie is to watch and learn by reading the lines on such forums (or rather reading "between the lines"). Yes, it was 100 times harder back in time when no Internet was available. But everything changes. And even the most shadowy business like property is opening up slowly. I guess with my initial post I tried to highlight this precise fact. It's no surpise that the murky business of selling properties through auctions is prone to abuse. One example that Vanessa has highlighted is when you can buy property in one local auction and then flip it next day in, say, Central London auction. This is just one out of hundreds of the real life examples and I'm only trying to find ways to shed some light or make this shadow practice more transparent, if you like.

    Going back to the pre-programmed logic story. If you break down any decision making process (Jonathan's or anyone else's), it's not difficult to pinpoint reasoning why such individual is taking turn left or right at certain crossroads. This reasoning might be obvious and lying on the surface in some cases and not so obvious under other circumstances. The key question is how to unwind, how to get to the bottom of it. Nowadays we are seeing a truly phenomenal transformation of every single aspect of our lives by new technologies. If you may agree with me, every industry is being currently turned on its head. Property (including sourcing, identification of opportunities - you name it!) as a business is no different, it's just a matter of time. First, the wave of enhancement tools will be coming upon us (this is already underway), next our participation will be irrelevant as we will be at the mercy of algorithms. Like I said, it's coming. The winner then will be that person who will be using the best (read: most advanced) algos. It's already happening on industrial scale in equity trading, the property industry is just lagging a little bit behind. Partly because of its murkiness, partly because of a lot of conflicted and intertwined interests from higher up, partly because of gravy train and statism in brick-and-mortar business. But this WILL change whether we like it or not. Our main task is to watch, learn, fine-tune and evolve further and then to know when to enter and, of course, at what point to exit.
    0
    0

    (09-12-2015 12:06 AM)ipsy_dipsy Wrote:  My apologies if I disappoint you, but I can't even think of partying with 100-quid-an-hour to pay for picking on your brain because I don't really need to. And the only reason why I believe I don't need to is because I'm already there, i.e. inside your head
    .
    But let's not underestimate the element of luck here because on the back of Jonathan's mind, I presume, he also keeps a warm thought that if today was 1990, then these +65% would have easily turned into more like -65%.

    You have an abundance of energy enthusiam and intelligence which i like . I hope you set that energy on the right path to achieve your goal. You make some big assumptions though which i do not entirely agree with. I fear that if you assume these then your ensuing logic and the subsequent precise data processing module you seek will be fundamentally flawed. I will select out two assumptions for now

    Inside my head - My written word on PT represents a small select sample of how my brain operates in relation to property and occasional other tangent subject matter. We can pick up a sense of how people think on here but there are layers upon layers of untapped thinking inside everyone's brain which can never be unraveled even over a course of a lifetime even by an expert psychiatrist. The brain is just to complex.

    One of my friends who I have known for over 40 years came to see me the other day. We have brilliant amicable conversations but after all our dialogue together over the years speaking face to face and observing the intricacies of our respective body language we still have difficulty `getting` each others view.

    `` “If the human brain were so simple that we could understand it, we would be so simple that we couldn’t.”
    - Emerson M. Pugh

    ------------------------------------------------------
    Luck - I lived through the recession of 1990 and saw my own residential house go from 100K to 60K. When I began investing in 1999 I used that experience to frame my strategy. I knew another recession would occur at some point. In 2008 some of my properties lost 25%. Some I bought in 2006/ 7 went into negative equity . Maybe on paper I lost about 500K . It didn't really affect my business growth as my overall equity was fine, my cash flow was fine and my reserve capital was fine. I carried on buying through to 2012 when many investors had stopped or faltered. That was not luck in my view that was a planned execution of a predetermined strategy.

    When Jordan Speith shot a hole in one the other day was that luck?

    ``The harder I practice the luckier i get``
    - Gary Player

    .
    0
    0

    Jonathan Clarke. https://www.buytoletmk.com


    Thanks for such an interesting and thoughtful post!

    It does highlight why the anagram of auction is "caution".

    The thing about auctions is that they have a hefty dose of emotion thrown in and this can make them very unpredictable.

    It all depends who is in the room on the day and how much self-control they have imho.

    People are known to get carried away.

    I believe that auctions are for experienced investors only who know their area like the back of their hand, and have done INTENSE due diligence including getting the auction pack looked at by a solicitor.

    Properties are put in auctions for many reasons, some of them legitimate, some of them sinister. The unwary can be easily caught out.

    One trick sellers use is to put the property into an auction a long way away from where it is located, because they know the locals won't fall for it if it was in a local auction.

    The vendor hopes that someone who hasn't done much DD will get carried away.

    I think many auction houses published reports, but other than that, I don't really know of any other source of auction data.
    1
    0
    ipsy_dipsy Wrote:
    My open question is how to find them systematically. Through deep local knowledge, sheer experience and gut feeling???

    Agreed.However, as individuals we all have differing opinions to VALUE. Jonathan had his and his experience won the day.

    A few weeks ago I viewed a house with a guide of circa. 100K. Having viewed it, I decided I wouldn't touch it with a bargepole. It sold for 140K at auction, plus the extras. You would need to ask the buyer how he/she reached that valuation.

    Your example 2: It could be that the first sale did not complete and therefore was immediately put in the next auction (the history you show suggests 237K was crazy)
    1
    0

    Full time Landlord in WestYorkshire, mentor and property education to new and inexperienced PRS investors. 25+ years of working knowledge. Accredited NLA member & RLA member https://www.landlordgeoff.co.uk [color=#800080]

    Great posting from everyone here!

    London is a complete different ball game as we are based in the East Midlands but time and time again we visit auctions and see low end property for going way over the asking price. Recently there was a 2 bedroom house in the St Ann's area of Nottingham. Guide price was 40k and ended up going for around 70k, now that's not a lot you may say.. Property needed 20k+ worth of works and would not be worth more than 80k once completed..

    Explain that! I guess a lot of people view they will keep that property for years to come but doesn't seem like a viable option to me.
    0
    0

    Aaron Cambden Director at Fairview Estates Residential Lettings & Sales. Property Investment. Letting Agents Nottingham