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  • Auction Tribe

    Buying Unsold Lots

    Hi
    I'm property sourcing for investors in South London focusing on commercial properties and I am hoping to start sourcing properties via auction houses from their unsold lots.  I've never bought anything at an auction (although I have visited a few to get a feel of things), but I'm wondering if anyone could advise how best to buy unsold lots, or even come to an arrangement for lots pre-auction.
    Is it simply about building a relationship with the auctioneers?

    Any other tips are welcome too!

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    You just aproach them with an offer, before auction. they will either say yes or no. All mine have been no so far.

    Post auction again you just contact them and make your offer. I have bought 2 post auction, one was under normal buying rules where we made the offer the next day and could have pulled out plus had time to do all the checks etc. The other they still wanted auction rules, so we were committed from when we agred to buy. However that was the day of the auction when it didn't sell and they came back to us as, the highest bidder, and offered it to us.

    It really is as simple as ringing them, As for making a relationship, they deal with 1000's of people so unless you are buying several a week I doubt you'll make much of a relationship with an auction house.


    Good luck Derek


    Good luck


    Derek

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    Hi Sophia,

    I've included below an excerpt from a blog I put together with some helpful tips on buying at auction which includes tips relevant to your question:

    Hope it helps...

    In this article, property auctions expert David Sandeman, Managing Director of EIG reviews 5 key strategies for making money when buying at auctions.

    Auctions have always been seen as the place where great deals can be purchased, but how do you maximise your chance of getting one of them?
    1. Look for lots being offered by an auction house well outside their area
    Especially if they are a regional auctioneer, as they may have a big following in that area, but if they don't you will have less competition bidding on the lot.
    2. Look for unusual lots being offered by an auction house
    If they are predominately a commercial auctioneer and they have a residential lot (outside their area is even better), they might have less interest in the lot than a residential auctioneer located in the town.
    3. Try an offer prior to auction
    If you see a property you like the look of, try an offer prior to auction. It will normally have to be at least 'guide plus', and if accepted you will be under pressure to attend the auctioneer's office to exchange contracts. You will need to be completely comfortable with the legal and physical condition of the property before exchange of contracts and whilst doing this due diligence, the vendor could change their mind for whatever reason. The benefit of buying prior is that if you are successful you would have carried out your due diligence and secured the property at a price that is good for you with the certainty of not being outbid at the auction.
    4. Register your interest on withdrawn lots
    On average about 8% of all lots are withdrawn, this could be because the vendor no longer needs to sell it or the legal documents are not available. Or it was offered vacant and the tenant has not left, or a million and one other reasons. If you see a property you like (and our site will advise you of them) and it is withdrawn, then ask the auctioneer why and register your interest. It may be that the reason it was withdrawn will be tidied soon, but not before the auction and the auctioneer may well call you when the issue is resolved to offer it to you without the competition of a later auction.
    5. Make an offer on unsold lots
    Currently 25% of all lots don't sell at auctions. In some cases, these could be considered orphans, with no home to go to. Let's consider the vendors position. He put it to auction so is probably a motivated vendor. He didn't sell it prior, and he didn't sell it in the room, so where is he going to go? He will definitely want to have a discussion with you via the auctioneer about you buying it. Try an offer based on the reserve and you can always go up.

    https://www.eigpropertyauctions.co.uk/news/blog
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