Dear Barry

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Unless you've never owned a TV, chances are - especially as someone with an interest in property - you've watched Homes Under The Hammer.

The BBC One daily daytime show follows the fortunes of a selection of auction properties, from pre-sale to the auction room, finishing with the big 'reveal' of what happens to it under the ownership of the winning bidder.

The programme is now in its 21st series, and although there's a 'before and after' makeover element which is naturally appealing to a wide base of viewers, its enduring popularity is a testament to our continuing national fascination with the comings and goings of the property market.

Buyers featured on the show are primarily buy-to-let investors, attracted by the affordability and simplicity of auction buying - no estate agents, no offers and counter offers and waiting around. The hammer falls on the day and the highest bidder owns the property. 

But as we all know, it's rarely that cut and dried when it comes to investing in bricks and mortar. So I thought I'd put together a quick guide to investing in rental property at auction.

How does it work?

There are a number of auction houses selling property in Northern Ireland and like any other industry, each business will have their own processes and procedures. 

But largely, it goes like this:

You pick up a property catalogue from the auction house or browse online to find the property/properties you want to bid on.

You'll then arrange a viewing. It is absolutely vital that you physically go and see the house, flat or site you're interested in. A catalogue description and a gallery of photos will never give you all the information you need to make an informed choice about this investment. 

If you've watched Homes Under the Hammer, you'll know what I'm about to say next...

The legal pack! Again, each auction house will have their own term for this, but you should be able to get your hands on some documentation that gives you key background information you need.

For example:

  • Are there any structural issues such as subsidence?
  • When was the plumbing and wiring last serviced or replaced?
  • Leasing information - freehold or leasehold? When do any leases expire? Who is the leaseholder?
  • Have there been any major structural changes or development?
  • Is there any planning permission in place?

So, armed with the facts, you pick your property/ies and it's auction time. To register as a bidder, you'll usually need to provide a deposit, but this will count towards paying for anything you successfully bid for, and is refunded if you don't buy anything.

Once the hammer comes down and you're the highest bidder, you have committed to buy that property and will need to secure it with a further deposit on the day, usually 10% of the sale price.

You'll usually have to settle the balance within 28 to 30 days, otherwise you lose your deposit. If that property is re-listed and sells for a lower price than your original winning bid, you might have to compensate the vendor for the difference in the prices, so only bid if you are sure you can pay up in time, otherwise you're guaranteed to be out of pocket.


The most common questions about buying at auction revolve around mortgages. Obviously being a cash buyer makes the transaction far simpler, but this isn't always an option, particularly if you're just starting out.

In this case, you'll need to either get a mortgage agreed in principle before you go to auction, or secure a bridging loan to cover the cost until you get a mortgage in place.

Bridging or 'gap' loans are popular because they can be put in place more quickly than a mortgage - but they can be the riskier option if you're counting on being able to arrange a mortgage and keep the property.

These are short term loans, designed to be paid back promptly, either in cash (fairly unrealistic for most) by selling the property (which of course works if you are doing it up for a quick sale) or by arranging a mortgage.

Where they come into their own for auction purchases is for properties that a lender cannot or will not mortgage, eg. one without a kitchen or bathroom, or some other serious defect.

A bridging loan is made purely on the sale value of the property at that time with no other conditions other than the tight timeframe for repayment. So, it's ideal if you want to buy a house that needs a lot of work. You renovate it, sort out the problems that made it unmortgageable and pay back your bridging loan by either selling or securing mortgage finance.

They can also be a good option if you aren't able to get a mortgage or loan agreed in principle prior to auction. They can be agreed quickly and easily (usually approx. a 10 day turnaround), so can be put in place as soon as you have won the bid on your property.

Bidding options

You can either bid in person at the auction, online or on the phone during the auction, or you can place a commission bid.

In person

The fun option! Auctions can be fast-paced and exciting and it's a thrill to cast the winning bid direct to the auctioneer with your own hand.

Phone or online

Both work in similar ways - you're either on the phone with a member of staff or following the auction online, often able to see a livestream video if the auction.

You'll keep up with the bids via phonecall or online notifications, and bid by communicating to the telephone caller or by submitting it on an online form.


Before the auction, you leave your maximum bid amount with the auction house. The auctioneer will bid on the property on your behalf, up to your maximum amount. They will only bid as much as it takes to top the opposing bidder.

Homework and research

I touched on this earlier, but I can't overstate how important it is to go into property auction purchasing with your eyes wide open. Properties are sold at auction for a myriad of reasons and there are truly are some fantastic bargains to be had. Often it's simply the speed or ease of sale a vendor wants.

But the quality of property varies wildly. Rock bottom prices can be good news for rental yield figures, but quite often the cheapest auction properties either need full refurbishment or demolition, or they are a complicated prospect due to structural issues, leasing, or legal wrangles.

Before you even start browsing, decide what your priorities and capabilities are. 

  • How much work are you willing and able to do or outsource? What skills, finance, time and support do you have available to you?
  • What is your absolute maximum budget? Can you afford to go over your budget? Can you cope with unexpected expenses; what is your plan B or safety net?
  • Who is this property for - ultimately? Are you renting it out for now with a view to living in it or passing it on to family one day? Or is it a pure financial investment? These questions will help you make key decisions, from location to refurbishment and layout options.

Ask the experts

Some key professionals to seek advice and support from throughout the auction property investment process are:

  • Surveyors - they will be able to spot the issues in a property that impact its value
  • Builders and contractors - up-to-date information and advice on the cost and length of repair or refurbishment work, and the most effective way to project-manage these
  • Solicitors - an expert eye to look over legal packs, contracts and finance agreements before you sign the dotted line
  • Sales & letting agents - they know property values, area demographics, plus demand and rental rates for buy-to-let investments

Doing the sums

Our rental yield calculator tool is hugely popular with seasoned landlords and aspiring buy-to-let investors alike.

Just drop us a line to if you'd like a pdf copy emailed to you for free.


What are your thoughts on investing in auction properties? Would you like to see more auction properties and features on the blog? Do you have any questions I didn't answer here? Drop us a line to and let us know your thoughts.



Investment involves risk and the value of capital and the income derived from it may go up as well as down. Past performance is no guide to future performance. Unless otherwise stated, the views expressed here are those of The Belfast Property Blog. Nothing in this article should be regarded as advice, it has no regard for the requirements of any particular person.