Auctioned properties are a fantastic way to make a smart investment choice as these properties are usually purchased at a fair price or below the market value.
Here is a list of things to look out for when your buyers and/or investors are keen to purchase an auctioned property:
- Type of Auction
- Title and Condition of Property
It is advisable to perform the necessary inspection on the property and to conduct a land search at the land office to certify who owns the property.
Through a land search, you will know the type of title, status of the title and whether there’s a private caveat. Having a lawyer is the best way to deal with a private caveat as removal of the caveat requires a court order.
- Vacancy of Property
An auction property does not always come with a guarantee of vacant possession. Once you’ve successfully won the auction, you can either evict the occupants by engaging with a lawyer or speaking to them to move out. Alternatively, you can always offer to rent the property to the occupants.
- Outstanding Payment
You should obtain the Proclamation of Sale (POS) and Conditions of Sale (COS) from the auctioneer to evaluate all the terms and conditions.
It is important to check whether the property has any outstanding bills and maintenance charges that have yet to be settled. Thus, it is vital to consult a lawyer to review the payment clauses in the documents.
- Balance Purchase Price
Once you’ve successfully won the bid, your buyer and/or investor will be required to settle the balance purchase price depending on the kind of auction.
To facilitate a smooth transfer of property, it is advisable to enlist a lawyer. It is prudent to have spare cash in hand as late payment will result in the auctioneer deposit being forfeited.
Bidding on an auction property might seem daunting but with these steps, it’ll be easier for your buyer and/or investor to own such property. For those who can’t resist a bargain, an auction property is a viable opportunity to possess property at a fraction of the original market price and is a great return on investment.
