Buying Or Selling A Property At Auction
Whether you are buying or selling a property at auction, Wilson Browne Solicitors are here to help.
We have extensive experience dealing with buying and selling agricultural, commercial and residential properties at auction.
Our teams offer prompt, easy to understand tailored advice to clients whether they be experienced land developers with a property portfolio or one-off prospective purchasers looking at making a speculative bid at auction.
Advice for Buyers
Auctions can be a fast and effective way of buying and selling property, but they are not of course without their risks. It is imperative when buying or selling at an auction that you seek advice from a solicitor experienced in dealing with property auctions.
What is always staggering is the sheer amount of people who think they only need a solicitor if they are successful at auction. The reality is that, as a buyer, if you have a successful bid at auction, then at the moment the gavel comes down and your bid is successful, you are then contractually bound to purchase.
What this means is that the opportunity for a full and detailed due diligence exercise is lost. Or rather, whilst you can instruct someone to carry out due diligence, it is too late to do anything about it!
At a property auction, contracts are legally exchanged and both seller and buyer are committed, with a 10% deposit usually being paid on the day.
Completion is usually set for within 28 days of the auction, though you should always check the auction terms before bidding (it has become common for some auctions to allow a 6-week window, but ultimately you will be bound by the special conditions set out for the specific auction lot that you are bidding for.
A prudent buyer will have instructed solicitors to consider any existing auction pack and conduct all of the necessary checks and enquiries in plenty of time prior to the auction; allowing sufficient time not only allows you a chance to read and digest your lawyer’s report, but it also gives time for any additional enquiries to be raised and potentially even the chance to try and negotiate a private sale prior to the auction.
When acting for a buyer, our services are twofold. Firstly, prior to the auction we will consider the auction legal pack and put together a report based on this and advise you as to whether the property is being sold with good and marketable legal title.
Secondly, if your bid is successful we will then act for you in dealing with the transfer of the legal title to the property into your name. A prudent buyer should ensure that all of their funding is in place and that they will be able to have this drawdown in plenty of time for completion.
Advice for Sellers
Once you’ve decided to sell at auction, the temptation can be to get the property listed asap at the very first auction available; the key however is to take the time to compile all of your paperwork, to speak to any lenders about redemption figures (if applicable), to speak with your solicitor about auction pack requirements and to ensure you have sufficient time to submit an auction pack that is as complete as possible and gives you the best chance of securing a successful bid at the very best price.
When acting for a client proposing to sell at an auction we will put together all necessary documents for a full property auction pack. When doing so we will endeavour to anticipate what a prudent buyer and his solicitor would expect to see in the pack.
Typically, the legal pack would include an Energy Performance Certificate, searches, evidence of title (be it registered or unregistered), draft Special Conditions, a draft Transfer, and replies to standard enquiries, together with any necessary disclosures.
The extent of enquiries will vary depending on whether it is commercial, agricultural, or residential and we will liaise with the seller to obtain replies to these. Between submission of the auction pack and prior to the auction itself, we are on hand to assist with any queries a prospective bidders legal team may wish to raise on the auction pack. Finally, after the auction, providing a bid has been accepted, we will then deal with the sale of the property.