Property Auctions

Property auctions are a great way for immovable assets to change hands. Real estate transactions are usually time taking, and auctions are a quicker alternative. They are far more economical, too. A Sunday Times report claimed that up to 90% people who sealed house deals at auction houses managed to save a whopping 40%!

It is no wonder, then, that this practice is gaining ground in the race to own landed properties – be it residential or commercial, be it free tracts of land or constructed plots – the auction has become the choice.

UK is one nation where this practice is well used. London property auctions have been a popular method for sale of immovable property since several decades. Houses on lease or rent or for sale are auctioned off by a work force of over four hundred auctioneers and property auctions agents. From the just-married couples to the shrewd real estate investor – all bargain hunters come to try their luck at the multifarious London property auctions.

The obiter dicta of people regarding auctions is time tested. The earliest was probably carried out in 500 B.C. in Babylon and was actually for the purpose of giving up young girls of the household for marriage, just like chattel! The highest bidder would win the bride. Attractive women would have no trouble getting a new home, but the guardians of the women not meeting the criteria for beauty would actually have to pay some money to entice a bidder.

Roman culture also reports auctioning of war spoils – a practice that found an echo in the American civil war. Reports also claim that the wise Roman king Marcus Aurelius had to auction off his household furniture to pay his creditors.

Auctions were also carried out in China to obtain a good profit for temple property.

There are two major types of auctions:

• English type – the auctioneer begins the proceedings by calling out the lowest possible price of the article under the hammer. The bidders compete with each other by each proposing a price higher than the previous one. Hence, the term \'ascending\' type of auction.

• Dutch type – the auctioneer calls out the highest possible price of the article and keeps on calling out subsequently lower prices until someone from among the bidders accepts the auctioneer\'s price. This is hence called the \'descending\' type of auction.

However, though this public outcry method of sale comes with a number of virtues, it is not entirely rid of pitfalls. Especially, the customers attending residential property auctions are more liable to be duped as they are not as aware as their more commercial counterparts are.

As they say, being a sitting duck helps nobody. Like the mongoose family, the motto of an avid home hunter also should be \'Go and find out.\' It is necessary to:

• Obtain the property catalogue of the assets one may be interested in. The same can be obtained at the auctioneer\'s for a small charge, or may be downloaded from the website of the relevant auction house

• Go through the catalogue and do a further short listing of the potentially interesting properties

• Visit the properties with, if possible, a surveyor in tow to perceive the actual condition of the same

• Be aware – follow property auctions news, read property guides and magazines and increase your general knowledge about the property auctions procedures

• Once inside the auction house, always be on your toes and keep a cool head. Vow to yourself never to lose it! Auctions are adrenaline driven shows, and novices are quite likely to make indiscrete bids in the heat of the moment

• Once you have placed the winning bid, ensure that you have the cash ready. The winning bidder is supposed to pay 10% of the amount at the auction house itself, and the remaining amount within 21 days. If such is not the case, the sale is considered null and void and the property finds itself back under the hammer

Such and other tips for buying auction can be found at several websites on the internet and in property magazines and newsletters. Even the BBC and the Times provide a great deal of relevant information on the same. The Essential Information Groups or the EIG is a source of reliable information, too.

Residential property auctions are fast becoming a popular method for property sale