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In my area the properties dont seem to be coming on the market - inflating prices on what is on the market. I have recently started looking at other areas and properties which are coming on auctions (large HMO's or blocks of flats) having kept my eye on half a dozen and getting quotes from my solicitor that auctions packs will cost £300 a time to scan over - it seems to be quiet a big expense when you are not guaranteed to win the auction.
It would be good to get the views from the seasoned auction buyers on here on what they do in regards to check and fees prior to the auction.
Hi Sam,Auction pack checks are absolutely vital and they are part of the costs of buying at auction, even though you may not win the bidding.
You may find these threads helpful:Guide to buying a property at auction - Auction packs Legal packs at auction - what to look out for? Auctions, solicitors, legal packs, best practice? In some instances, our legal partner Anthony Gold Solicitors, will deduct the cost of the legal pack from their bill, if you give them the conveyancing of the purchased property.Contact alan.zeffertt (at) anthonygold.co.uk to discuss.Hope that helps?
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Hi Sam, I agree with all the advice that you have been given above, before you bid on a property you must ensure that you know what you are buying and have the legal pack inspected by a solicitor.
However, as you point out you could spend hundreds of pounds on fees and then not buy it for two main reasons: firstly, it sells for more than you were prepared to bid for it, and secondly the legal pack shows up an issue that you are not comfortable with. I would recommend two courses of action to mitigate both these risks.
Firstly, most properties have a quoted ‘Guide Price’. It is imperative that you realise that this is not what the auctioneer necessarily thinks the property will sell for but is only an indication as to where the reserve is currently set. What you need to do is see what similar properties have sold for at auctions and if they are selling for more than you want to pay it might be best to leave it and look for another.
Having decided that similar property sales are within your budget, and you are happy with the property itself from a structural point of view now is the time to look at the legal pack. Unless you are very experienced you must engage a solicitor before you bid but there is some work you can do prior to getting a solicitor involved.
Review the legal pack looking for reasons why you wouldn’t buy it, look out for factors such as lease length, management charges etc., does the title plan match what is on the ground? (with leasehold property is the property laid out as per the layout in the lease?) and take a good look at the covenants to see that all are currently being complied with and would not prevent your plans for the property from happening. Read the ‘Special Conditions of Sale’ and understand what extra fees might be payable.
Should you see anything you are not happy with you could ask a solicitor to advise on this and if as a result you are happy, then ask him to review the entire pack but ask him to contact you the moment he sees something that might be an issue so that if you decided not to proceed you have not paid for him to review the rest of the legal pack.
If you have any doubts on a property having taken professional advice the best course of action is “Do Not Bid”.I hope this helps and shows a realistic way for keeping fees to a minimum and not spending money on lots you probably would not have bought.