Buying a property at auction can be an exciting and fast-paced way to secure your next home or investment. However, it differs significantly from traditional property transactions. Here’s what you need to know about the process and how we can help you navigate it smoothly.
Key Differences Between Auction Purchases and Traditional Sales
In a standard property sale, the buyer and seller agree on timescales for exchanging contracts and completing the transaction. Auctions, on the other hand, come with fixed timescales, depending on the type of auction:
Traditional Auction
- Properties are sold to the highest bidder, provided the reserve price is met.
- Contracts are exchanged immediately after the auction, with a 10% deposit paid on the day.
- Completion must occur within 28 days.
Modern Auction
- Conducted online with more flexible rules.
- The winning bidder pays a 5% reservation fee and must exchange contracts within 28 days.
- Completion is required within 56 days of the auction.
Regardless of the type, buyers are typically expected to reimburse the seller for the cost of any searches provided.
What’s in a Property’s Legal Pack?
Before bidding on a property, it’s essential to review the legal pack thoroughly. This collection of documents is designed to give potential buyers all the information they need to make an informed decision. Here’s what you’ll typically find in a legal pack:
- Auction Terms and Conditions – Details the specific rules of the auction, including deposit requirements and deadlines for payment.
- Title Register and Title Plan – Confirms ownership and outlines any restrictions, covenants, or rights affecting the property.
- Search Results – Includes local authority, water, and drainage searches, as well as environmental reports where applicable.
- Special Conditions of Sale – Lists additional terms unique to the property sale, such as specific fees or obligations for the buyer.
- Tenancy Agreements (if applicable) – Provides details of current tenants and rental agreements if the property is sold with tenants in place.
- Energy Performance Certificate (EPC) – Shows the property’s energy efficiency rating, which is a legal requirement.
- Planning Permissions and Building Regulations Certificates – Relevant for properties with extensions, renovations, or other works carried out.
- Lease (if the property is leasehold) – Contains key lease terms, including ground rent, service charges, and the remaining lease term.
- Management Information Pack (for leasehold properties) – Details service charges, maintenance responsibilities, and information about the managing agent or landlord.
- Property Information Forms – Includes the TA6 (general property details) and the TA10 (fixtures and fittings).
- Other Relevant Documents – Such as guarantees, indemnities, or warranties related to the property (e.g., damp-proofing or structural guarantees).
Why Reviewing the Legal Pack is Crucial
The legal pack is your opportunity to understand the property’s legal and financial position before committing to a bid. Failing to review it thoroughly could lead to unexpected costs or complications after the auction. Our conveyancing experts are here to help you understand the legal pack, so you can bid with confidence.
Let Us Help You Navigate Auction Purchases
Buying a property at auction doesn’t have to be daunting. Our dedicated team has the expertise to guide you through every step, from reviewing the legal pack to ensuring you meet strict deadlines.
Contact us today for professional advice or request a FREE quote to get started with confidence!
