13 Oct 2014

Conveyancing before the sale: An emerging trend

Conveyancing before the sale: An emerging trend

Chris Comfort, Senior Solicitor, examines house sales by auction and how this is becoming an emerging trend for home-owners looking to sell. 

Chris Comfort, Senior Solicitor, examines house sales by auction and how this is becoming an emerging trend for home-owners looking to sell. 

The Autumn housing market throughout Scotland is looking promising with prices in certain areas, including Aberdeen, continuing to rise.  It is precisely because of the healthy state of the property market that many people, both buying and selling property, overlook the potential of an auction, but this might be about to change.

Aberdeen’s first property auction, which took place in August, has generated considerable interest, so much so that it featured in the BBC’s “Homes under the Hammer”.  Whilst considerable stigma remains attached to sale by auction, much of which is associated with distressed sales, there are many, often unrealised advantages, when buying at an auction.

Auction sales can offer a wide variety of choice, with properties ranging from the typical buy-to-let and development opportunities to million pound properties and the ‘forever home.’  Most notably, however, sale by auction can offer clients both simplicity and speed.  There are no best offers, sealed bids or closing dates.  Once the gavel falls, the sale is final.  A Minute of Enactment and Preference is signed, the property sold and a 10% deposit (or a minimum of £2,000 if the property is sold for less than £20,000) paid on the day, with the price being paid typically 14-28 days later.  Aiming to reduce uncertainty in what is an increasingly buoyant market, the auction process compares favourably with the often lengthy negotiations involved when concluding Missives.  

On the other hand, it is precisely this idea of simplicity and speed, which turns what lawyers would consider the ‘typical conveyancing process,’ on its head.  With the successful bidder committed to complete the purchase instantly, much of the conveyancing when buying at auction must be done in advance. At the earliest possible opportunity purchasers and their lawyers should scrutinise what is often referred to as the ‘legal pack’ – containing amongst other things: the memorandum of sale (or Articles of Roup), special conditions of sale, title deeds, searches and any other rights or conditions affecting the property.  

Key to the conditions of sale is the notion that the purchaser must accept the property ‘tantum et tale’, or as it stands, with all or any defects and problems, a fact which prevents many from seeing the auction as a viable alternative, but providing you have done your homework, there is no reason why it shouldn’t be.  The legal pack is available to view on the auctioneers website, which details all properties for sale at the auction and includes links to websites of introducing agents.

With Aberdeen’s first property auction a success and a further two planned for later in the year, purchasers are well advised to seek both legal and financial advice from their local branch of Aberdein Considine in order to find out whether or not the auction process is for them. 

Chris Comfort, Senior Solicitor

Please correct the errors below before submitting your request:

Get in touch

Our dedicated client contact team prefer to receive enquiries through our contact form. We'll endeavour to get back to you within 24 hours or during the course of the next working day.

Source of enquiry