Selling a Property at Auction
An Auction is where a property is purchased or sold at an auction house. Bids are placed, once the highest bid is accepted and the gavel (hammer) goes down contracts are exchanged.
If successful, selling at an auction can offer the speedy completion which is usually 21 days after the Auction. There is no break down of chains, no changing of minds or negotiations of the sale price. Most properties that are sold at auction are those that require a lot of renovation work, unusual properties and difficult to place a valuation on, conversions, commercial or a tenanted properties.
However, selling at auction is expensive. Should the property not be successful at auction you still must pay for the auctioneer’s costs or if it is successful you must pay the auctioneers commission.
Before the auction the auctioneers will list the property in the auction catalogue, the sale board, draw up various documents, answer enquiries and make available the seller’s solicitor’s legal pack.
Before the auction you should instruct the services of an independent Conveyancing Solicitor for them to prepare the legal pack, title deeds, leases, responses to pre contract enquiries and to draft the Special Conditions specialised to your requirements.
It is important that if the property is being sold with tenants then a Special Condition must be inserted into the contract that the property is being sold subject to the tenancy and vacant possession will not be given on completion. If the property on the other hand is not being sold with the tenants you must ensure that any current tenants have been served with the required notice and will vacate on or before completion.
If you have elected to waive VAT exemption in respect of the property, you should ensure a clause is inserted into the contract that will bind the purchaser to pay VAT in addition to the purchase price.
If you are considering selling a property at auction please feel free to contact us to discuss your requirements.
Additional Reading:- A Guide to Buying a Property at Auction
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