Buying a home at auction can be a fantastic way to create your dream property, but it also comes with unique challenges and risks.
If you’re considering an auction home, it’s crucial to approach the process with careful preparation and understanding of the challenges that you might face.
So, if you’re looking to create your dream home, here are four essential factors to consider when buying a home at auction.
1. Thoroughly Research the Property and Auction Process
Before you step foot into the auction room — physical or virtual — it’s important to have as much information as possible about both the property you have your eye on and the auction process itself.
If you’re not sure on how to find properties up for auction, or even how auctions work, Auction House is a great place for you to find auctions, properties, and advice to help you succeed at your first auction experience.
2. Consider the Need for Renovations
When buying a house at auction, you may need to prepare yourself to make extensive renovations in order to create the home of your dreams. You should research the property’s history, its current market value, and any potential issues that might affect its value should you wish to eventually sell.
If possible, visit the property and get a professional inspection to uncover any hidden problems that might not be apparent from the outside. If you are able to take a look around the property before the auction date, then you’ll have a better idea of what challenges you may have in store.
For example, if the property was previously occupied by an elderly resident, you could find that there is a stairlift installed. Luckily, experts such as We Buy Any Stairlift can come in and remove it safely, leaving your property renovation ready.
3. Set a Realistic Budget and Stick to It
The auction room can be a competitive and rapidly moving environment, that can cause you to get caught up in the moment.
In order to avoid overpaying, it’s a good idea to set a realistic budget that is based on your research, and then making sure you stick to it.
You’ll need to determine the maximum amount you are willing to spend on the property, taking into account not only the cost of the property, but expenses such as the amount you’ll need to spend on renovations.
4. Understand Potential Legal implications.
When buying a property that you know you’re going to need to renovate, it’s important to consider legal practicalities, for example, are you going to need planning permission for your desired changes?
Planning permission can be tricky if you have uncooperative neighbours, and while you might find that the process runs smoothly for you, it’s always something that you should keep in mind.
Similarly, it’s important to consider the age of the property. Older homes are more likely to need renovations to bring them up to scratch, but it’s also always important to check to see if the property you have your eye on is a listed building. Listed buildings will require you to jump through a lot more legal hoops if you want to make changes, and even simple fixes can be more costly.
Have you purchased a home at auction? Share your tips and tricks for auction success in the comments below!
