Beware of auction bargains

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by Kay Murchie

Many private investors choose to buy property at auctions, rundown, old houses may be overpriced at auction and an investor could be left with a considerable amount of work to do.

The Society Protection of Ancient Buildings (SPAB) have warned that house prices can be overstated at auction as auctioneers don’t necessarily know what they’re putting up for auction or don’t understand an older property. The property may seem ideal but may not be habitable. Once you’ve bought the house, you’ll then find that you have to spend several hundred thousand pounds more than you anticipated.

Property auctions used to be the only method developers and investors opted for. The internet is the driving force behind the increasing number of investors and developers looking to save money by buying a bargain investment.

In 2006, around 18,000 residential properties were sold at auction in the UK, a huge 132% rise on the 7,883 auctioned in 1997. The nation’s liking for TV shows such as “Homes Under The Hammer” promote auctions as a way of getting a good deal on a property.