Property website Zoopla has launched a live online Property Auction. This exciting venture is a partnership between Zoopla and Real Estate Disposition Corporation (REDC). Don’t worry if you have not heard of REDC before, they’ve been in America for years and apparently sold over 30,000 properties in 2008.
Zoopla is something of a rising star in terms of property portals and claims to be the number two site after Rightmove.co.uk. You could be forgiven if the idea of a property auction website sparks ideas of Ebay, but it’s very different.
The next “event” is 7th February and so far there are 73 properties up for auction, but how does it work?
- As you would expect the first step is to register on the site, this is important because unlike Ebay auctions the property details can change before the auction start date.
- You are buying a house! Each listing has extensive property details under the label “due diligence”. Remember that once you enter a bid it’s binding and you are stuck with whatever you win – even if it’s a lemon.
- Arrange your finance before the auction starts – just like a “real” auction you don’t have long after the virtual hammer strikes to complete the sale. There are penalties if you fail to complete in time.
- If you wish you can visit the property to carry out an inspection or survey (vital if you are using finance).
- The action starts and the bidding begins. All online.
- Within 48 hours of the end of the auction you will be expected to transfer the 10% deposit and buyer’s premium. You will also be able to verify your identity.
Before you start thinking about putting your own property up for auction, the system is only available to Estate Agents – so no dodging the agents fees!
What About The Properties Being Sold At Auction?
From what we understand this is just like regular property auctions and so will include just about any type of residential property. Possibly properties that have been on the market for a long time with no buyer or sales under pressure, such as repossessed homes or probate sales. Just like a regular auction the property is being offered very much “as is”. So it’s up to the buyer to ensure that they can cope with anything they find under the floorboards.
Zoopla and REDC have obviously created partnerships with the usual property professionals, so you should be able to use their services for conveyancing and financial services. As well as residential mortgages and buy to let mortgages they should also be able to arrange bridging finance.
Remember that you have no recourse to the seller if things go wrong post-auction. The contract is formed when you place a winning bid and the auction ends. That means the full purchase price and no negotiation.