OpenRent Community

Auction Property - Good or Bad?

Hi all

So I have a small portfolio of BTL properties and am looking to expand. Been looking at auction sites to pick up something at a good price. Its a lot of work reviewing the legal packs, assessing condition etc with no guarantee the bid will succeed.

Has anyone got any experience of picking up a BTL property at auction? If so would love to hear your views and if this is something you would recommend.

Vikram

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It is a lot work trawling through Legal Packs and making viewings etc.

Many landlords do buy at auction. We did and got a good property that needed renovation - nothing structural.

You can make a pre auction offer.

Just be aware of fees. It’s usual for a purchaser to pay the legal costs of the seller plus any auction fees (and own legal fees of course).

i have made 2 pre auction bids and got both places Very happy with them.

Ok. So when making a pre-action offer, should I start with the opening / guide price? Tried once and the auctioneer told me I need to go substantially higher than the guide price for owner to consider pre-auction offer.

I went to the auction house before the auction and went above the guide price in both case . They were “come and get me guide prices” Guide prices are a load of coblers. So yes always higher.

AVOID at all costs “the modern method of auction” its a huge rip off.

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Thanks. Can you suggest any good auction houses? i am looking at McHughs currently

that depends where you are in the country. I am a landlord on Merseyside. As this is an area I have lived in and bought in ,i am reasonably familar with the property market. I have bought a big commercial unit and shops and Houses in flats so buy what you are familar with… Bargains are less avaiable lately though. Personally I would only do bids where I can SEE the competition

Interesting. I am actually looking at Liverpool myself targeting a 2 / 3 bed for circa 100K for better rental yield than the 5% I get in East London. Looking at L15 and L13 postcode. Would welcome your thoughts on this.

Wavertree and old swan are good rental areas L15 and L13. Dificult if you live miles away . However In Old Swan a few years back I renovated a house there for a landlord who was living and working in Japan ! He did not buy at auction but off Rightmove

Another good area Is Widnes … I have rented out a shop there for about 30 years .It has a good shopping centre.

Relying on a good estate agent to deal with all operational management and issues. Ideally would be close but not possible and need to look further away if I want a better return.

Will look into Widnes. Do you do renovations too?

i have been renovating homes for 50 years . I am a joiner. But now retired from building work I have a few properties and I sell insulation from my unit,. That keeps me fully occupied. I work more hours now than whenI was younger! In Widnes you can get some neat properties for 100k. and in OSwan ,But places are selling rather quick

I did reply to your private email about old swan not sure if you got it.

I’ve never bought or sold at auction, but would recommend watching homes under the hammer on BBC1 10am Monday to Friday.
It would be interesting to see if any of the other commenters have seen this program and how they compare it to the real thing.

I accidentally bought in auction. I mean I went to see how auction operates. And had viewed a property o was interested in but thought it would go for way more than guide price so had no anticipation of bidding. But only one person bid on it. The hammer was about to go down & I stuck my hand up. It went back & forth between the 2 of us. I win. I nearly Sh-t myself!! I was shaking as I had 2 weeks to complete. One of the best things I’ve ever done. This was in 2015 and I got it for 48,000. It’s now worth 150, 000. What I really like that option is you get everything upfront. Going through estate agent I don’t ever want to do again. They just lie. People selling lie. Repossessions they have to be very factual. At least that’s my experience on the only property I’ve ever bought in auction. But you have to remember there’s a reason why properties are in auction. There’s always something. In my case, there was a history of terrible neighbours into drugs et cetera. Thank God they’re all gone now.Yes it’s a little bit risky but it’s risky buying from anyone and frankly I felt as it was as it was a repossession I had all the information I needed to make a decision. It was more through the buying a property through Estate Agent…

Thanks Amy. Yes I can relate to that. Spent hours doing my rearch for 2 different auctions but did not have the courage to bid for one and not high enough for the other. Sometimes you have to just bite the bullet although a lot more at stake now due to higher property values than 6 years ago. Being based in South East means cant do full research for properties in North which are more affordable and better yield. These forums help great.

Hey Colin

Yes I did receive your private email. Useful advice. Thanks

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I dont understand the property market, we are supposed to be in recession with the lockdown but the prices seem higher than ever and selling.

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We too are in the South East and bought up North. Spent many hours going up and down motorways and had a hard time finding builders etc. at such a distance. At auction you do definitely have to bite the bullet, but we did see what we proposed to purchase beforehand.
Recently sold at auction too and the purchasers were from the South. They just handed the property straight to the Auctions Letting Dept.