Online property auctions

Property auctions are the last bastion of finding bargains, but there are things to consider first. Don't get carried away and stick to your budget. Most auctions are facilitated online, so you're less likely to get swept up in the atmosphere at an auction house. If you are successful, the deadlines for compelting are tight so get your lending in order, if you need it. There are some specalists who who have auction products, a good mortgage adviser can recommend these. Finally, familiarise yourself with the fees. Some auctions charge the buyer fees and these can be huge, espcially compared to the price of the property if you're looking at a modest house.

On-Line auctions came into prominence during Covid and is now an additional route to market providing sellers the same benefits of a normal auctions but allowing 56 days instead of the usual 28.

Auctions are fraught with pitfalls. The modern method makes the process more flexible and daunting but invariably the buyer pays the agents fees via a sometimes hidden ( or not so apparent ) "buyers premium" . This is often a large sum stipulated in the sales particulars and the buyer has to make allowances. This could be written in words and not numbers.

The devil as they say is in the detail so you must get a lawyer to cast an eye over the fine print for onerous clauses and also have a mortgage and survey done in time for the auction. There is no substitute for research to ensure you're not over-paying.

The extended completion timescales allow buyers to obtain traditional mortgages and not have to look at fast bridging loans which is quite common in normal 28 day completion auctions.

Unlike traditional auctions where contracts are exchanged immediately, modern online auctions give buyers up to 56 days to complete, giving them more time to arrange a mortgage. Bidding happens online, often over several days, and if you win, you’ll pay a non-refundable reservation fee which is usually 3 to 5% or a set amount. Buyers also cover usual costs like surveys, legal fees, and sometimes a buyer’s premium. The main pitfalls? Limited time for due diligence and little room to renegotiate once you commit. But the pros include a transparent process, less chance of being gazumped, and a clear timeline - which is ideal for motivated buyers who’ve done their homework.

Online property auctions might seem like bargain hunting's holy grail, but they're more like a high-stakes game where the house usually wins. Unlike traditional hammer-falls that demand completion in 28 days, modern online auctions typically give you 56 days to get your finances sorted - which sounds generous until you realise you're still racing against time with specialist mortgage products and hefty fees lurking in the small print.
The catch? That tempting guide price is often fairy-tale fiction, with properties selling for double or triple the estimate. While you won't get gazumped and the process is transparent, these auctions increasingly favour cash-rich investors over ordinary homebuyers. Before you bid, get your solicitor to scrutinise every clause and ensure your mortgage adviser understands auction finance - because once you've won, there's no backing out.