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Investment Property Accountants

A Guide To Buying Property At Auction –

The Role Of The Auctioneer

In the third in a series of articles, we take the opportunity to look at the role of the auctioneer.

• The auctioneer acts as agent for each seller. They prepare the catalogue, based upon information supplied by or on behalf of a property vendor. This will usually include a photograph of the property, a brief description and a guide price.

• The auctioneer sells each lot at the auction. During the auction, their decision on the conduct of the auction is final; they can cancel the auction, withdraw lots from sale, or alter the order in which lots are offered for sale.

• The auctioneer looks for bids around the room, and will take bids until there are no more and, depending on whether the reserve price has been met, will sell the property to the highest bidder. This sale is confirmed when the auctioneers gavel (hammer) falls on the highest bid. At this point the successful bidder is immediately under a binding contract.

• The auctioneer may also choose to refuse a bid and they are under no obligation to explain why.

• Where there is a dispute over bidding they are entitled to resolve it. Their decision is final.

• Where the reserve price is not met the auctioneer may choose not to sell it and withdraw the lot. However, they still act as agents for the seller and, therefore, bidders can put in offers for the lot after the auction, which may or may not be accepted by the seller.

• Equally, in their role as agents, the auctioneers can take offers placed by bidders before the day of auction to the seller, giving the seller the option to sell prior to the auction.

When attending an auction, it is important to decide on your maximum bid in advance and be disciplined. If you don't trust yourself not to get carried away, entrust somebody else to bid on your behalf. Remember that property is an investment and paying in excess of what you consider to be a fair price will only erode the return on your investment, whether it be to buy and sell or to rent out.

Please note that this article is intended as a guide only. If you are considering purchasing a property at auction you should always consult with auction professionals and solicitors.

Date of Article: 13th January 2009

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This domain is owned by Warr & Co Chartered Accountants which is a member of the Institute of Chartered Accountants in England & Wales (ICAEW). Whilst the information detailed here is updated regularly to ensure it remains factually correct, it does not in any way constitute specific advice and no responsibility shall be accepted for any actions taken directly as a consequence of reading it. If you would like to discuss any of the points raised and / or engage our services in providing advice specific to your personal circumstances, please feel free to contact Peter Edwards on 0161 477 6789 or email us at info@warr.co.uk

 

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