Struan's Wood

Our auction experience was a bit of a baptism of fire so we thought we would share our top tips here for anyone considering buying land at auction.

• REHEARSAL If you have never been to a land auction before then it’s a great idea to go to one as soon as you start even considering buying at auction. Pay attention to the hand signals that are used by the bidders. Does the auctioneer accept small bid increases as the bidding goes on and how do bidders communicate that to them? Have a look at the room set up and how many people are there. If it is crowded you may struggle to be seen by the auctioneer so you need to get there quite early to get a seat near the front. Luckily for us Rich is 6’5″ so he could be seen easily even though we were right at the back of the room!

• SOLICITOR You will need to have found a solicitor before the auction as you need to give their details before you leave the auction house. Most auction contracts have a very short completion time (28 days in our case) so it is worth doing as much paperwork in advance with the solicitor as you can such as ID checks and providing proof of funds. You can also ask them to start checking the contract and performing searches but you will have to pay for this and if you don’t win the auction then that will be money lost.

• CONTRACT The contracts will be available to view before the auction and if you place the highest bid you will have to sign the contract before leaving the auction house no matter what it says. This is different to buying a house the traditional way where your solicitor can negotiate the contract with the vendors solicitor. Our contract stated that we had to pay a certain percentage of the vendor’s solicitors’ fee, which is unusual, but we had no opportunity to negotiate.

• FINANCES If your bid is successful then you will need to have the ability to pay the deposit and certain fees before you leave the auction house. Check with the auction house beforehand about how much the deposit is (10% in our case). You will probably also need to pay a Buyer’s Premium to the auction house. This was 2.5% plus VAT at the auction we attended. If your money is in savings accounts, premium bonds etc then you need to factor in that it can take a few days to transfer the money out. There are also the practicalities of how you actually transfer such a large amount of money to the auction house. A lot of bank accounts have maximum electronic transfer limits and we saw other people having to call friends and family to get each of them to transfer X amount from their own accounts as they owed more than they could transfer individually. We had phoned our bank in advance who said we could transfer the full amount by telephone banking which would incur a fee. Alternatively we could phone them up to get a temporary increase in our electronic transfer limit for a few hours and then transfer it electronically for free.

• UNSUCCESSFUL? If you weren’t successful in bidding for the land you wanted it is worth taking a note of the estate agents for the properties you are interested in. If the property didn’t reach the guide price and wasn’t sold you have nothing to lose by phoning the agent and putting in an offer a few days later. The vendor may realise that it is worth taking a lower offer than getting nothing at all. Some sales fall through, so it is worth giving the agent a call after 28 days to see if it has come back on the market.