Have a property for sale? What are the pros and cons of auctioning your property? We delve into the full details here.
Pros And Cons Of Buying Auction Property For Sale
Whether you are looking to buy commercial or residential property, it’s important to weigh up your options. Buying auction property for sale does not necessarily mean that you will get an exceptional deal on the property, although this is possible. There are different types of auctions including sheriff auctions, voluntary auctions, bank auctions and property in possession auctions.
- Sheriff auctions – where a bond holder has been unable to continue with bond repayments and there is no possibility of these funds being recovered
- Voluntary auctions – where a seller has chosen to put their property on auction
- Bank auctions – where a bond holder has fallen behind on repayments but has been given the option to sell at auction, writing off any shortfall
- Property in possession auctions – when the bank buys a property back at a sale in execution and incurs all the costs involved. When they sell it on inclusive of all costs, it is a property in possession
There are quite a few intricacies to auction sales. Here are both the pros and cons of buying auction property for sale.
Pros Of Buying Auction Property For Sale
If you’re considering buying a residential or commercial property at auction, here are a few of the pros involved:
- Properties bought at auctions come without lengthy negotiation periods
- There is less competition when buying at auction
- The seller is completely invested in selling the property
- The seller is contractually obligated to transfer to the highest bidder
- It is an exciting process that can often result in you securing a decent price for the property
- You can bid on and buy properties from the comfort of your desk chair through an online auction
Cons Of Buying Auction Property For Sale
The biggest risks of buying property at auction include:
- You have limited time to view the property and inspect it for issues
- Auctioneers can pit buyers against one another to try and get a better price for the seller
- The purchaser is responsible for outstanding rates and/or levies, which makes it incredibly important to see if these accounts are in arrears
- The purchaser is normally responsible for the eviction of any existing occupants
- If the owner has debts to pay, the transfer can be held up, which keeps your investment locked up too
You must be able to pay all the fees over in a prescribed amount of time or you will forfeit the sale. It is common and best practice to have all your finances in order before going to auction.
Are you ready to buy your property at auction?
View all our current auctions and sales here or contact us if you are looking for something specific.