We here at Adrian Hassett Auctioneers know that few moments in property are as exciting as the fall of the auctioneer's hammer. Auctions bring energy, transparency and a clear result on the day, and they can be a great way to secure a home, a site or an investment property. But buying at auction is very different from buying by private treaty, and the rules leave little room for second thoughts. Before you raise your hand or click to bid online, here are the five things every buyer needs to know.
1. When the hammer falls, the deal is done
This is the single most important point to understand. With a private treaty sale, an accepted offer is usually subject to contract, finance and survey, and either party can walk away until contracts are signed. At auction, the successful bidder signs a binding contract on the day, typically paying a deposit of 10 per cent on the spot. There is no cooling-off period and no option to make the purchase conditional on a mortgage or survey. The closing date is set out in advance in the conditions of sale, and if you fail to complete, you risk losing your deposit and facing further legal consequences. In short, you must be absolutely certain before you bid.
2. Do your homework before auction day
Because there is no chance to investigate after the hammer falls, all your checks need to be completed beforehand. Ask the auctioneer for the legal pack, which normally includes the contract, the conditions of sale and the title documents, and have your solicitor review everything well ahead of the auction. They will look for issues such as rights of way, boundary discrepancies, missing planning documents or unusual special conditions. Arrange a full survey too, particularly as auction properties can include probate sales or homes in need of renovation. Spending money on checks for a property you may not win can feel frustrating, but it is far cheaper than discovering a serious problem after you have signed.
3. Have your finance fully in place
Mortgage approval in principle is a great starting point for private treaty purchases, but it is rarely enough at auction. Speak to your lender early, as you will generally need full loan approval for the specific property, including the lender's own valuation, before the day. Make sure the deposit is ready and available, and if you are a cash buyer, be prepared to show proof of funds. Remember to budget for the usual purchase costs, such as stamp duty and legal fees, and check whether any buyer's fees or administration charges apply, which is more common on some online auction platforms.
4. Understand guide prices and reserves
The guide price is an indication of where bidding is expected to start or settle, but it is not the price you will necessarily pay. Irish property services law requires that an auctioneer does not quote an estimated selling price, including at the auction itself, that is below the advised market value given to the seller. The reserve is the minimum price the seller will accept, and it is normally kept confidential. The law also prevents sellers from bidding at their own auction or having anyone bid on their behalf, which helps protect genuine buyers. If bidding does not reach the reserve, the property may be withdrawn, although the seller can choose to accept the highest bid made on the day. Where a property goes unsold, it typically moves to private treaty sale, which can create an opportunity for interested buyers to negotiate afterwards.
5. Set your limit and stick to it
Auctions are designed to create momentum, and it is easy to get carried away in the excitement of the room. Decide your absolute maximum in advance, based on your survey, your finances and recent sales of comparable properties, and do not go beyond it. Familiarise yourself with the process before the day. Register to bid if required, bring photo identification and proof of address, and if possible attend another auction first to see how bidding works. For online auctions, register early, test your login and make sure you have a reliable internet connection. Some buyers find it helpful to ask a calm friend or adviser to bid on their behalf, keeping emotion out of the equation.
Offers before the auction
It is worth knowing that some sellers will consider strong offers before auction day. If you are serious about a property, ask the auctioneer whether pre-auction offers are being entertained. Be aware, though, that a seller who accepts an early offer will usually expect you to proceed quickly and on similar terms to an auction sale.
The bottom line
Buying at auction can be fast, fair and rewarding, but only for buyers who prepare thoroughly. Complete your legal and structural checks, secure your finance, understand how the reserve works and set a firm limit. That way, when the hammer falls in your favour, you can celebrate with complete confidence.
If you would like to discuss buying or selling a property, contact us on 0871303206 or email sales@adrianhassett.com or visit adrianhassett.com.
Disclaimer: This article is based on publicly available information and is intended for general guidance only. While every effort has been made to ensure accuracy at the time of publication, details may change and errors may occur. This content does not constitute financial, legal or professional advice. Readers should seek appropriate professional guidance before making decisions. Neither the publisher nor the authors accept liability for any loss arising from reliance on this material.
