Buying By Private Treaty

What now seems a very old fashioned phrase which means buying a property in the normal way rather than via auction.

Currently, if an estate agent markets your property, a buyer comes along and buys it using a solicitor in the normal legal process. This is private treaty. If you have decided against buying at auction, there are a number of different ways to buy using the private treaty method.

 

1. The Estate Agent

Estate agents still deal with the vast majority of property transactions throughout the UK and whether you think you will ultimately buy from an estate agency or not, you should look at them as an invaluable ally in the local property market to do market appraisals and give you information about demand in the area [as most agents also let property they will know demand and rates for future lets].

They will also have a lot of data about properties they have sold in the area that will give you an idea about the price that you are paying for anything that you see.

Remember though that the estate agents work for their client, the owner. So, some of their advice may have, shall we say a hidden agenda! Get to know your local estate agent. They are in the vast majority of cases, friendly and helpful even when there might not be a chance of a fee. They will know good local trades people and should be able to help you look after your property more efficiently.

 

2. Online Estate Agents

Undoubtedly, a fast growing sector in the market who offer both the same and different service to the traditional High Street agent.

The service level whilst friendly and efficient, can never be as personal as after all online agents generally do not see all of their own properties, have not met the owner and do not know the local area particularly well.

They try to make up for this by being super-efficient promoting property heavily online and dealing in large volumes of property. Online agents are, if I could use this analogy the McDonald's of the property world; quick, efficient and getting the job done but without the frills of your local favourite restaurant.

An online agent may have the perfect property for you to buy, but do bear in mind that the after sale service may not be as full as your High Street can offer.

 

3. Property Acquisition Companies

Such as dare I say Pure Acquisitions, specialise in acquiring property on behalf of clients [also called a retained service]. The crucial difference between an estate agent and a company such as Pure Acquisitions is this: an estate agent works for the seller to get them the best price. . .

A buyer's agent works for the buyer and is paid by them. This way they can concentrate on the buyer's requirements fully and also relieve an owner, perhaps in financial difficulty, from having to pay fees.

Many buyer agents help you cash flow their business by requesting upfront payments for registration or when the property is found and in the thousands of pounds and there have been a number of high profile cases of companies collapsing owing clients thousands of pounds.

At Pure Acquisitions, there is no registration charge. A small administration charge is payable upon agreement of a purchase with the balance payable on completion. We will never request more than this in advance - guaranteed.

 

Glossary

Some of the key phrases you'll hear at an auction - this is what they mean:

Actual completion date

The date when completion takes place or is treated as taking place for the purposes of apportionment and calculating interest.

Addendum

An amendment or addition to the conditions whether contained in a supplement to the catalogue. This may be a written notice in the catalogue, or announced at the auction.

Auction

A public sale in which property or items of merchandise are sold to the highest bidder.

Auctioneer

The person who conducts an auction. The auctioneer introduces each lot offered for sale, acknowledges bids, and announces whether lots are sold or unsold and their final bid prices.

Auction catalogue

The catalogue gives a description of the property, details on how to view each property and the General Conditions of Sale. These are prepared by the auctioneer, stating the basis on which the auction is carried out.

Bid

The offer to buy property at a specific price.

Completion

On completion of the sale of the lot there is usually a defined time period from the auction to the completion date in which the sale must be finalised. Penalties will be applied if the sale is completed late which can include losing your deposit.

Exchanging contracts

If you are the successful bidder at the auction sale, the sale is binding on the fall of the hammer and you will then be asked to sign and exchange contracts in the auction room.

Guide price

A guide price gives an indication of the price that the property is expected to sell for and what the vendor is hoping to achieve.

Guide prices are for information only and shouldn’t be relied on as an indication of reserve price, or representing professional valuations for any purpose. Purchasers are deemed to have relied on their own knowledge or obtained the independent, professional advice of others.

In the room

A bid from someone in the room (not by phone.)

Legal pack

The vendor's solicitors prepares a legal pack containing copies of all the legal papers that you and your solicitor are likely to need to make an informed decision about your lot. The pack should include (where applicable) copies of: special conditions of sale, title deeds, leases, office copy entries, searches, replies to pre-contract enquiries.

All legal packs will be available for inspection at the auction room. You must be aware that you buy subject to all documentation and terms of contract whether or not you have read them.

Lot

Each separate property described in the catalogue or (as the case may be) the property that the seller has agreed to sell and the buyer to buy.

Previews or exhibitions

A viewing of the property held in advance of the auction. Pre-auction viewings are open to the public and may be attended at no charge.

Private treaty

The sale of a property at a price agreed by the seller and the buyer or their agents.

Proxy bid

The auctioneers can undertake bidding on behalf of buyers unable to attend the auction in person. The buyers must contact the auction house prior to the auction to obtain an official, proxy bidding form. This must then be returned to the auction house with a deposit cheque within the time specified by the auctioneers. The buyer writes the maximum amount they will bid to on the form and the auctioneers will bid on behalf of the buyer, up to, but not beyond, the stated price.

Reserve

A reserve price is the lowest price the vendor will accept. This is agreed between the vendor and the auctioneer. Most properties entered into the auction have a reserve price. This is confidential and not disclosed to any interested parties.

Telephone bid

A telephone bid, made by a member of staff from the auction house. The staff member telephones the client from the salesroom to bid on particular lots and relays the client's bids to the auctioneer during the bidding on those lots.

Tenancies

Contracts to occupy or lease the property subject to rent. A lot may be sold subject to exisiting tenancy agreements.

Withdrawal

Failure to reach the reserve price or insufficient bidding. The auctioneer will withdraw the property from the auction.