What I Look For Before I Even Think About Bidding at a Property Auction
Let's talk auctions. They can be a fantastic way to snag a deal, but they are also a guaranteed minefield for bidders going in blind. This is not just a quick list; this is my actual process, the stuff I am frantically checking right up until the auctioneer's gavel falls. My worst nightmare would be to end up with buyers remorse, so I spend a lot of time and investigate everything to do with the property.
First and Most Important: The Legal Pack
I never, ever bid on a property without thoroughly reviewing the legal pack. This is my number one rule. The pack is usually hidden away on the auctioneer’s website, and you have to dig for the download link. Inside, I look for everything, but I have a special focus looking for one thing that is pure gold if I can find it: the TA6 Property Information Form.
Now, a seller at auction is not legally required to fill out a TA6. It is a standard part of a private treaty sale, but auctions are different. They often say “buyer beware” and leave it at that.
But sometimes, I get lucky. A thorough seller or their solicitor might include a completed TA6 in the legal pack to make the property more attractive and prove they have nothing to hide. If it is there, I drop everything and read it first. This form is the seller spelling out, in their own words, the history and nuances of the property.
Here is exactly what I am hunting for in that TA6:
- Boundaries:Who the seller thinks is responsible for which fence or wall? This is a classic source of neighbour disputes. If they say a boundary is unclear, I know I might have a problem to solve later.
- Disputes and Complaints: This is the big one. Has there been a falling out with the neighbours over noise, parking, kids playing football against the fence or anything else? They have to disclose it here. Finding a “no” in this box is a small relief, although if it is a yes it may not be a deal breaker and has worked in my favour before now.
- Alterations, Extensions, and Planning: Did they build that conservatory or loft conversion with proper planning permission and building regulations sign off? If the form says yes, I still double check the paperwork in the pack. If it says no or they do not know, I see a giant red flag and I factor in the cost of regularisation or even demolition.
- Utilities: Are all the services connected? Do they know where the drains run? Is the property on a private road they have to help maintain? This tells me about potential hidden costs.
- Flooding and Environmental Issues: Has the property ever flooded? Even just a little bit? Is the area at risk? Is there any known contamination in the ground? This directly impacts my insurance costs and future saleability.
Invasive Plants and dangerous substances: Has the property ever had invasive plants like Japanese knotweed? Are there invasive plants next door? Is the area at risk of invasive plants taking over from further away? Is there any known asbestos contamination/ oil contamination in the ground? This directly impacts future saleability and I factor this into my bid cost.
Mining and Subsidence: Has there been mining in the area historically? Is there subsidence in the property or neighbourhood? Does seller pack show the mining maps? Mining in areas of South Wales and the Midlands can create mortgage and structural issues with housing built above mine workings. So personally I dont purchase in areas where there is mining underneath houses and I am looking to flip.
But all this being said, a huge word of warning: The TA6 is based on the seller’s knowledge. They might be honest, they might forget, or they might deliberately omit something (though this leaves them open to a legal claim for damages if they intentionally omit what they knew) . It is a crucial piece of the puzzle, but it is never a substitute for my own investigations. It does not replace a survey, and it does not replace me knocking on the neighbour’s door.
Anecdote: I once bought what looked like a cracking terraced house in South Wales. The guide price was low, and competition wasn’t fierce. What put other bidders off was a short remark in the legal pack about an on-going 3 year boundary dispute with the neighbouring property. Because I’d done my homework, I was prepared for it and had negotiated before hand with the neighbour and agreed that if I won the property bidding I would transfer over the disputed land to him ( literally about a one foot strip down the length of the garden if he moved the fence at his cost). So to resolve the dispute cost me nothing and to be honest the loss of the strip of land did not affect the property resale value at all. In the end, I made a very tidy profit, but only because I knew what I was getting into.
Also, I quickly check if they have included a TA10 Fittings and Contents Form. This tells me if those fancy light fixtures or the integrated appliances are actually included in the sale, or if they plan to rip them out. It helps me budget accurately.
The rest of my checklist is absolutely critical, especially when a TA6 is not available
Title Register and Title Plan
I confirm who the actual seller is. Is it a bank? A developer? An individual? This tells a story. I check for any restrictive covenants. I check if it is mortgaged. You know, crazy stuff like “you cannot keep pets” or “you must paint the house a specific colour, or you cannot work from the property.” I look for any rights of way. Is there a path through the garden that the neighbours have a legal right to use? Are the boundaries correct and do they match the site plan?
Special Conditions of Sale
This is where they hide the nasty stuff. I read every single word. I look for additional fees the buyer has to pay, like the seller’s legal costs or a percentage of the purchase price on top of the hammer price. It happens. That is why I use my cost calculator to ensure any hidden auction costs do not tip the property value into negative.
Searches
Are they included? If not, that is a huge red flag. Why would the seller not provide them? I particularly scour the Local Authority search for planning notices, like a compulsory purchase order or if the nearby road is scheduled to be a major motorway. I check for any enforcement actions against the property. And I check for any planning applications on this property at the local authority website.
Leases and Management Packs (For Flats)
If it is a leasehold, the lease is everything. I immediately check document TA7 for details such as the number of years that are left on the lease. Anything under 80 years used to be expensive to extend but that is rumoured to be changing in the next year or so. I look at the ground rent. Are there onerous clauses that make it double every 10 years? I check if the service charges are reasonable? Are there huge bills pending for a new roof that I will have to pay for?
I also check if there is an absent freeholder (this can be a nightmare) and if the freeholder doesn’t respond to Section 42 notices or sends insane service charge bills, I keep away.
Title Register and Title Plan
Let me give you the view from my side of the virtual podium. I have watched thousands of people win and lose in auctions. For every property I have won at auction , I have probably walked away during bidding from 10 and lost out another 10. The ones who consistently win are not the loudest or the richest. They are the best prepared.
First, I do not even think of bidding until I have read that legal pack. I mean really read it. I see people skip this regularly, and it is the fastest way to turn a win into a financial disaster. If you’re new to all this your solicitor must advise you on it, and the solicitor must make you understand every special condition.
Set your absolute maximum bid and write it on a post it note. Stick it to your phone screen. The adrenaline is real when that lot goes live. I have watched people get caught in a battle of egos and pay thousands more than they planned. That piece of paper is your anchor. Respect it.
When you bid, be decisive. Do not hesitate. A quick, confident bid tells everyone else you are serious and you know exactly what you are doing. It makes other bidders nervous. It makes me take notice.
Here is a little secret. Use odd numbers. If the bid is at two hundred thousand pounds, do not just go to two hundred and five. Bid two hundred and two thousand, five hundred. It looks like you are bidding right to your precise, pre calculated limit. It can throw other people off their game.
Do not start the bidding. Let someone else do that. You gain nothing by going first. Watch. See who is in the race. Understand the rhythm of the bidding before you even get involved. I tend to come in late, after all its worth seeing where other bidders interest is starting to peak.
And finally, know when to stop. The biggest wins I see are not the properties that sell for the highest price. They are the deals where a disciplined bidder walks away the second the bid amount exceeds their limit. There is always another property. You’re not bidding to win the auction. You’re bidding to buy a good deal. If you remember nothing else, remember that.
The Money Stuff: My Numbers
My Absolute Maximum Bid
My bid price is not the purchase price. I add on the auctioneer’s fees (which can be thousands), my solicitor’s costs, and the stamp duty. This is the real number I am paying. I check this against my estimates using my calculator you can also use for free here:
Finance at the Ready
I have my finance 100% available to spend. Auction purchases require a non refundable deposit (usually 10%) on the day, and the balance in 28 days or less. There is no time for a standard mortgage application. I either have cash ready or a confirmed agreement in principle from a specialist bridging loan company.
The Property Itself: Beyond the Photos
A Physical Viewing is Non Negotiable
I always, always view. I look past the fresh paint smell. I am looking for big ticket problems. I check the roof for slipped tiles. I look inside the loft for daylight coming through, or for signs of rotten timbers. I check the walls for big cracks, especially around doors and windows. I look and smell for signs of damp, that musty smell, peeling wallpaper, or dark patches on the walls. Outside I check for invasive plants, asbestos, waste oil spilled. I lift manhole covers to check drain condition and look for signs indicating subsidence or collapsed drains.
I Try to Talk to the Neighbours
Seriously, they are a goldmine of information. They will tell you if the place has a flooding history, if it is a party house, or if there is a long running dispute. A two minute chat can save you a fortune. I once had the option to purchase a large HMO, and went next door to the doctors surgery to ask the receptionist what the neighbours were like. Her honest response put me off the entire area. The residents of the area simply did not meet my tenant demographic.
I Assume the Worst with Utilities
I assume the gas and electric systems are unsafe and will need a full rewire and new boiler. I budget for that. I assume there might be asbestos, especially in artex ceilings or old floor tiles. I factor in the cost of safe removal.
The Final Checklist on Auction Day
I Re-Read the Legal Pack
One last time, just to be sure. Did I miss anything in the TA6 or special conditions?
I ensure I am registered bidder. Have I got my login details to hand? I do an internet access check.
I Have My ID and Payment Methods Ready
I Plan for the Worst Case Scenario
I ask myself, “If I get this property and it turns out to need a completely new roof, new wiring, and a new kitchen, does my final number still make it a good deal?” If the answer is not a definite yes, I do not bid.
That is my process. It is not glamorous, but it has kept me out of trouble. Finding a TA6 is like finding a cheat sheet, but you still have to sit the exam yourself. I always remind myself that the goal at an auction is not just to win a property; it is to win a good deal on a property. I hope this advice helps you snag one.
Types of Auctions:
You might have heard there are two main ways to buy property at auction: the Traditional Method and the Modern Method. While the classic image is of a room full of bidders in a hotel conference room, today most auctions (of both types) are held online. Don’t let the digital platform fool you; the differences in risk, cost, and legal process between the two are huge.
Reading on will give you the essential knowledge to tell them apart and choose the right one for your strategy.
Bidding at a Traditional Auction
The traditional auction method is the high-stakes, all-or-nothing approach to property buying. The process is brutally simple: the gavel falls, you are the winning bidder, and you are legally bound to purchase the property on the spot. You immediately pay a non-refundable deposit (usually 10%) and must complete the sale, typically within just 28 days. The speed and certainty are attractive to cash buyers and experienced investors who have their finances and due diligence locked down tight. However, the finality is absolute. If you get cold feet, your funding falls through at the last minute, or a previously hidden defect emerges after the sale, you are still legally obligated to complete. Failure to do so means you not only lose your hefty deposit but can also be sued for the auctioneer’s costs and any financial loss the seller incurs on a subsequent sale. It is a powerful tool for the prepared, but a potential financial disaster for the unwary.
Bidding at a Modern Method of Auction (MMA)
The Modern Method of Auction (sometimes called a “conditional auction”) looks easier at first glance. Instead of exchanging contracts immediately, you win the right to exchange. Typically, you pay a non-refundable reservation fee (often 4 to 5% of the purchase price or a set minimum, whichever is greater). You then get a longer period of up to 28 days to exchange and another 28 to complete.
It sounds safer, but here’s the catch: that reservation fee goes straight to the auction house or estate agent and does not come off the purchase price. Lose your finance, change your mind, or discover something nasty in the survey, and you’ve just kissed goodbye to thousands of pounds.
Anecdote: I once seriously considered and then investigated a bid on a bungalow through MMA. The price was right, but after digging into the detail, I realised the reservation fee was nearly £10,000. On top of that, the property needed a new roof and a fully rebuilt dormer. Many bidders didn’t factor the fee into their sums and I know the final bidder would have ended up paying well above market value. That decision to walk away saved me from what would have been a loss-making purchase.
Pitfalls of MMA auctions:
- Reservation fees are hefty and non-refundable.
- You may overpay because fees push the true cost far higher than the hammer price.
- Buyers assume they have more time and relax, but you’re still under pressure to arrange finance and surveys quickly.
- I have stopped purchasing from MMA auctions as the only real beneficiaries are the estate agents who get a far higher fee than if the property was sold at a normal auction.
Final Tips for Auction Success
- View the property : I never rely on photos. Hidden damp, subsidence, or structural issues don’t show up online.
- I set my maximum bid before the auction and stick to it. I don’t get caught up in the adrenaline.
- Add fees to my sums using my calculater, I compile and write down all auction fees, reservation fees (MMA), solicitor’s checks, stamp duty, and refurb costs so I know exactly what my costs are.
- Finance first: Whether bridging, mortgage in principle, or cash, I have it sorted and ready to spend before bidding.
Know my exit strategy : I plan if its rental yield, resale profit, or flip. I always go in with a plan, not a gamble.
People Also Ask About Buying at Auction
- View the property : I never rely on photos. Hidden damp, subsidence, or structural issues don’t show up online.
- I set my maximum bid before the auction and stick to it. I don’t get caught up in the adrenaline.
- Add fees to my sums Using my calculater, I compile and write down all auction fees, reservation fees (MMA), solicitor’s checks, stamp duty, and refurb costs so I know exactly what my costs are.
- Finance first: Whether bridging, mortgage in principle, or cash, I have it sorted and ready to spend before bidding.
Know my exit strategy : I plan if its rental yield, resale profit, or flip. I always go in with a plan, not a gamble.
Bidding at a Modern Method of Auction (MMA)
What is the difference between a traditional property auction and the Modern Method of Auction (MMA)?
A traditional auction means you exchange contracts immediately and completion within about 28 days. In MMA, you pay a non-refundable reservation fee to secure the right to buy and usually get longer to complete. The key difference is that MMA adds extra costs that invariably increase the purchase price by up to 20%.
Can first-time buyers use the Modern Method of Auction?
Yes, but it can be risky. MMA looks more flexible, but the reservation fees are high and non-refundable. First-time buyers often underestimate the true cost, so it’s safer to get professional advice before bidding.
Do I need a solicitor before bidding at auction?
Absolutely. A solicitor should always check the legal pack before you bid. They can spot hidden charges, lease issues, or restrictive covenants that could cost you dearly.
Can you get a mortgage for an auction property?
You can, but it depends on the lender and the property. Many auction properties need heavy work, so cash or bridging finance is often used first, with refinancing later. Always check with a broker before bidding.
What are the hidden costs of buying at auction?
On top of the hammer price, you should budget for: auction house fees, legal costs, Stamp Duty, surveys, refurbishment costs, and (in MMA) a non-refundable reservation fee.
