Newbie Question

[simon1984]

Hi, I am starting to do my research into property (buy to let) and have a LOT of reading to do, so hope you don't mind some stupid questions.

I have been looking at property auctions and trying to understand how these work and have some questions. I don't think I'm allowed to link to it, but basically any random item on sites like Future Property Auctions.

• why are items like this generally put up for sale? Is it as simple as the owner needs capital, or does it get more complex than this?
  
  
• if the guide price is £36,500, does it usually go for that, or lower or higher?
  
  
• what are the main risks in buying at a property auction?
  
  
• what does Asset Management Sale instruction mean?

All help is greatly appreciated.

 

[FWL]

Properties can go to auction for a variety of reasons such as the need to get capital asap and mortgage companies simply getting rid of properties they have inherited through default.

The guide price and the actual sale price will depend upon the property, area and demand on the day. I dont think there is any meaningful average figure here.

Main risks: You might find hidden issues when you gain entry to the property. Potential local authority planning application issues if you need to make major changes to the property. Very often they are priced very cheaply for a reason - ensure you do your research.

Asset Management Sale - I am not sure about the context of this?

 

[diyhelp]

Those who think they can just turn up at a property auction, make a bid and walk away with the deal of a lifetime will be in for a shock. Ironically, it may be the properties which sell for more than their guide price which offer the best value because you will find that the so-called “experts” with experience of property auctions will leave the more difficult properties alone.