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Buying a commercial property at auction can mean you secure a bargain, but you need to prepare carefully. Properties come with a wide range of rights, responsibilities and restrictions and you need to be fully aware of these before you commit to buying. Our experienced commercial property solicitors can ensure that you have the information you need to make the right decision.
Whether you want to buy a property for investment purposes or to use for your own business, it is crucial to have a full picture before you bid. You will also need to sort out any finance that you need beforehand because once you win an auction you will be given a tight timescale in which to complete the purchase.
Glanvilles’ commercial auction solicitors can give you the advice and guidance you need. We will make sure that the necessary due diligence is carried out well in advance of the auction so that you can consider whether you want to bid and how much the property is worth to you. We can also represent you if you have commercial property for auction as a seller.
Our services include:
Our commercial property experts will take the time to understand your aims and work to ensure that the transaction is in your best interests. Our advice is always clear and practical.
For more information, see our commercial property solicitors page.
You are strongly advised to ask an experienced conveyancing solicitor to go through all of the available documentation before you consider bidding for commercial property at an auction. Buying commercial property can be particularly onerous and it is important to have comprehensive legal advice before you take on ownership.
The principle or caveat emptor or let the buyer beware applies to auction property. You need to know exactly what you will be agreeing to buy beforehand as once the hammer falls, if your bid is successful, you are legally bound to complete the purchase and you will not be able to object at a later date if there is information that you failed to uncover.
Issues that your solicitor can pick up on include:
If you will be obtaining finance, your lender will require a solicitor to be involved on their behalf to ensure that the property is good security for their loan.
We will also deal with the payment of the balance on the date of completion on your behalf, sending the money to the seller’s solicitor. Once they send us the title deeds, we will arrange for registration of your ownership and we can also deal with issues such as transferring the lease and notifying the landlord or any tenants of your purchase.
If you ask us to represent you, then once we have given you our pre-auction legal advice and you are happy to proceed, you will not generally need us to attend the auction on your behalf.
You can attend in person or ask an agent to do this. Alternatively, you can bid over the phone or in some cases you may be able to bid online. You should check before the auction to see whether any extra information has been disclosed or new conditions added by way of an addendum.
You will need to register in plenty of time and make sure that you have your deposit ready, as this is payable immediately if your bid is successful.
You must also ensure that you will be able to pay the balance on the completion date, which will usually be within four weeks. If you fail to complete, you will lose your deposit, generally of 10% of the purchase price.
If you are buying or selling commercial property at auction, you will need to factor in the auction fees.
For buyers, there is usually a buyer’s administration fee payable at the auction at the same time as the deposit if you are the successful bidder. The auction house’s guide to buying will set out how much these will be.
It is sometimes the case that the buyer is also required to pay the auctioneer’s commission, which is a percentage of the sale price. Again, the guide will tell you whether this is the case.
It is more usual for this to be charged to the seller, however. As a seller, if you wish to auction commercial property you will be notified of the amount of the commission when you agree to put your property into the auction catalogue.
Your solicitor’s role in buying a property at auction starts well in advance of the sale and runs through until your purchase has been finalised. It includes:
We have extensive expertise in dealing with the auction conveyancing process. We know how important it is to move quickly when dealing with commercial auctions and we will work proactively to find out exactly what you need to know and to make sure that you have all necessary information to make your decision.
Our commercial property auction experts can offer:
When you use our commercial property auction service, we promise: