Support & Advice-Development sites at Auction!
Bidding at auction is a very exciting event. As we all know it is very easy to be tempted into a bidding war and before you know it you have simply paid more for something that in actual fact you could have found cheaper elsewhere.
This is one of the fundamental issues with bidding at auction. Developers bid for properties and sites, not only at a price they are willing to pay (occasionally more) but also because they hope this is what the property will be worth. The other issue being-are the correct permissions already in place.
So we are all made to believe that an auction price is in fact evidence that it is indeed the actual property/land market value, but this is not the case at all. This can lead to a number of problems as funders have varied criteria for lending and the danger here is that the clients funding request does not fit the criteria as the price paid was too high.
So please be aware that if you do wish to purchase a property/development site at auction that there are risks involved in this and anything bought at auction without planning carries significantly more risk.