Auction Jargon Buster

Stepping foot into a property auction can seem like stepping foot into a different world at times. All of the different jargon and technical terms that the auctioneer uses can put you off making a bid for a property.

It is important to understand exactly what this jargon means and how it applies to you.

Auctioneer

This is the person who carries out the auction. It is their job to introduce each property and start the bidding accordingly. They are the ones who accept offers from the audience and announce the winning bidder and what price the property sold for.

Bid

This is how much you offer for the property.

Auction Brochure

This gives details of all the properties, the conditions of the sale and who you need to contact to view them. The auctioneer will normally run through the properties in the order they are listed in the catalogue. These are normally obtained before the auction.

Completion Date

This is the date by which you will need to have paid your deposit and have your mortgage in place. This is often referred to as the completion date. If you do not complete by this date you could lose your deposit.

Guide Price

Every property that is listed in the auctioneer’s brochure will have a guide price. This is usually the price at which the agent expects the property to sell for, it is not necessarily the starting bidding price for the property.

A guide price is just that, a guide, in some cases it does not give any real indication of the property’s value.

Legal pack

The legal pack contains everything your solicitor will need for you to purchase the property. The pack contains all the legal information about the property, such as title deeds, any leases and the conditions of sale.

The legal pack will have all of the terms and conditions of the sale in, so it is important you view this before you buy, and if possible get you solicitor to explain it all to you.

Lot

A lot is simply the word used to describe the property that is up for sale, it will normally have a lot number in the brochure.

Proxy Bid

This refers to a bid that is made from someone who is not in the auction room. If you are unable to attend the auction for any reason you can contact the auction house and obtain a bidding form.

You will need to return the form and your deposit for the property to the auctioneers before the auction starts. On the day the auction house will bid on your behalf and stop bidding when they reach your limit.

Pre-auction viewing

This refers to any open viewings that may be taking place prior to the auction. It is not uncommon for auction houses to hold open previews, so that a lot of people can all come at the same time.

Reserve Price

This is the lowest price the seller is willing to accept for the property. This will not necessarily be the price that the property is advertised for in the auction brochure but the price the seller has informed the auctioneer of before the start of the auction.

Telephone Bid

This is a bid that is made over the telephone, usually by somebody who is working at the auction. An interested bidder will register their interest for a property before the auction starts and once bidding starts somebody at the auction will telephone them and they can bid over the telephone.

Auctions are not designed to be confusing they are designed to entice you in and make you want to bid. If however there are any phrases that the auctioneer or anybody uses that you do not understand they will no doubt only be too happy to explain these to you.