Buying at auction - advice needed

westcoast66

Hi - looking for some advice about buying at auction.

There is a parcel of land coming up for sale near me. Its beeing sold as follows:

Lot 1 : 8 acres
Lot 2 : 24 acres
Lot 3 : The entire

We are really interested in lot 1. If we are the highest bidder on lot 1, can the auctioneer still try to sell the entire?

bob charles

westcoast66 wrote: »

Hi - looking for some advice about buying at auction.

There is a parcel of land coming up for sale near me. Its beeing sold as follows:

Lot 1 : 8 acres
Lot 2 : 24 acres
Lot 3 : The entire

We are really interested in lot 1. If we are the highest bidder on lot 1, can the auctioneer still try to sell the entire?

yes, if lot one and two, make more money together than the entire when offered, and you are the highest bidder for lot one the hammer will fall to you

leoch

just say as a round figure i bought land for 100,000 what else woyld i pay like estate agents fees etc is there tax and all that what do u think would be the final figure when all is added up and signed and sealed

6600

If you are interested in the 8 ac then make sure that you are the highest bidder for it on the day. The hammer can still fall for the entire if the amount is high enough but there's not much you can do about it. Just hope there's minimal interest from anyone else. We were in exactly same position as you in '03. Dad was the only bidder so he got the small lot. Didn't have the money for the bigger lot unfortunately. The other lot wasn't sold at all.
I know its easy to say but don't fall for the auctioneers bull, e.g. 'There's someone else willing to pay more' etc etc. They are always lying, that's what they do. Fell for it myself last yr when bought a bit. Was only bidder but he still got more from me after. In hindsight I should have stood my ground and told him to f@@k off.
The money is not out there to buy land, if you have a good bit of it then you are in a strong position and in the minority. Good luck!

Oh, on the fees the seller pays the auctioneer so you won't have to worry about that. Stamp duty is 1%, 0% if you are under 35. The solicitors have this 3 way closing system now which means there's 2 solicitors to pay (just so they can make it on the double, the excuse is that its because of the dodgy solicitors). Solicitors cost me about €5k I think. Bank had a sol as well as me and I had to pay for both.

pakalasa

6600 wrote: »

.....I know its easy to say but don't fall for the auctioneers bull, e.g. 'There's someone else willing to pay more' etc etc. They are always lying, that's what they do. Fell for it myself last yr when bought a bit. Was only bidder but he still got more from me after. In hindsight I should have stood my ground and told him to f@@k off.......

I know someone recently, who stood their ground, like you said, when buying a house. It was sold to someone else. They thought the auctioneer was bluffing them. Tunred out another neighbour bought it.

6600

Oh I know, its worse than poker! I'm paying for it now but its mine I suppose. A house is different though, you can always find another one.

pakalasa

What you could do is get a friend of yours to enquire about it. See what the auctioneer says then. If he says 'there's one other interested party', then you know where you stand. Poker is right..........;)

westcoast66

6600 wrote: »

If you are interested in the 8 ac then make sure that you are the highest bidder for it on the day. The hammer can still fall for the entire if the amount is high enough but there's not much you can do about it. Just hope there's minimal interest from anyone else. We were in exactly same position as you in '03. Dad was the only bidder so he got the small lot. Didn't have the money for the bigger lot unfortunately. The other lot wasn't sold at all.
I know its easy to say but don't fall for the auctioneers bull, e.g. 'There's someone else willing to pay more' etc etc. They are always lying, that's what they do. Fell for it myself last yr when bought a bit. Was only bidder but he still got more from me after. In hindsight I should have stood my ground and told him to f@@k off.
The money is not out there to buy land, if you have a good bit of it then you are in a strong position and in the minority. Good luck!

Oh, on the fees the seller pays the auctioneer so you won't have to worry about that. Stamp duty is 1%, 0% if you are under 35. The solicitors have this 3 way closing system now which means there's 2 solicitors to pay (just so they can make it on the double, the excuse is that its because of the dodgy solicitors). Solicitors cost me about €5k I think. Bank had a sol as well as me and I had to pay for both.

Thanks for the response.

I think my problem is that if there is no interest in the small plot, I might be the only bidder. So I might think I've got it for a song, e.g. 50K. Then whoever buys lot 2, might just throw on another 51K for the entire.

Surely if the hammer falls, then its mine there and then?

dar31

leoch wrote: »

just say as a round figure i bought land for 100,000 what else woyld i pay like estate agents fees etc is there tax and all that what do u think would be the final figure when all is added up and signed and sealed

stamp duty, 1%, none if a qualified farmer under 35
your solicitors fees, recently paid 1.5% +vat, on a very complicated purchase
banks solicitors fees, fixed amount usually €1000, might charge more if there is a number of folios used as security, but hold hard for one set price
company guarantee €500, if required
auctioneers fee for a valuation on land as security
accountants (extra fees, if any) to do any work in preparing to look for bank loan
fee for any specialised advisers if required
plus a few other small ones ive forgot

poor farmer

westcoast66 wrote: »

Hi - looking for some advice about buying at auction.

There is a parcel of land coming up for sale near me. Its beeing sold as follows:

Lot 1 : 8 acres
Lot 2 : 24 acres
Lot 3 : The entire

We are really interested in lot 1. If we are the highest bidder on lot 1, can the auctioneer still try to sell the entire?

I would bid for lot 1 and also bid for the entire even if you don't want lot 2
It puts you in control.

Farmer Pudsey

You bid on lot1 and then you wait if there are no bids on lot 2 you let lot3 go too its highest bid and see what happens.

If you have time find out who is intrested in lot no2 and bid togeather on it.

If its a case of no bids on lot2 you have to decide what lot 1 is worth to you. More than likly the auctioneer will come back to the lots so you can rise your offer on lot no1 and maybe stoke out intrest in lot 2

Are you looking for the 8 acres to build on, is there no site potential on the 24 acres we would have to know more before we could give advice alot of 'if' and 'buts'. If you have an Uncle or father who is experienced take them to it and ask advice or a friend who will advice unless we knew it is hard to advice

Also land os not for sale until the until the auctioneer put it 'on the market' this happen when either the entire or the two lots reach a price that is at or near the sellers expectations.

it is tough out there when you have not experienced it before

PatQfarmer

Can't agree with 6600 that we are all liars! That said, there are sharks in all walks of life, so be careful.
If you are inexperienced in auctions, perhaps get a professional (Auctioneer or Solicitor) to help you. People think nothing of getting Ag advisors when making a small investment on-farm, the same should be the case when making a large investment.
Whatever happens, if you want to buy Lot 1, be the highest bidder, subject of course to your own financial limit.
If there is a bidder for Lot 2 and a bid for Lot 3 is higher than your combined bid, it is likely that the Auctioneer will sell the entire, but I would be surprised if he didn't come back to you both to see if you will "bid on yourselves" to try to beat the bidder for the entire. His job is to get the maximum for his client on the day, so every avenue should be explored.

If there is no bidder for the entire, your job is easier.
But whatever happens, as I said, be the highest bidder on your section.
Best of luck:)

Tipp Man

Think Pat is right

If you are not confident doing it get a solicitor or autioneer to do it for you

westcoast66

Thanks for the responses lads. The value of both lots is probably similar as lot 1 has much better road frontage/access and is beside our yard.

Yes, I suppose best approach is to just be the highest bidder on lot 1.

I'll have a word around and see if anyone is interested in lot 2. We could then maybe have a joint bid for the entire.

poor farmer

From my experience the people that you think are interested in the land wont bid for it, and someone that you didn't think would be a customer will.

Nearly always someone comes comes out of the woodwork and its usually someone you weren't expecting.
Also auctions never go the way you anticipate .

6600

I'm terribly sorry if I may have inadvertently besmirched a noble profession Pat . Wouldn't be keen on getting an auctioneer to bid for you personally unless you can trust him totally. Maybe I'm paranoid but they all know each other.

At the auction turn up late, they never start on time. Sit at the front, that way noone can eyeball you and you can say you didn't see who else was bidding. And remember to breathe! A minute feels like an hour. Still better than the messing that can happen with private treaty though.

If its seen that you are genuinely interested in the first lot then hopefully it will go to subsequent negotiations, unless of course someone comes along with enough to buy the entire. Slim chance I think, the number of people with access to >€300k are very small now unless road/development money around. Good luck anyway and stay cool

PatQfarmer

6600 wrote: »

I'm terribly sorry if I may have inadvertently besmirched a noble profession Pat . Wouldn't be keen on getting an auctioneer to bid for you personally unless you can trust him totally. Maybe I'm paranoid but they all know each other.

At the auction turn up late, they never start on time. Sit at the front, that way noone can eyeball you and you can say you didn't see who else was bidding. And remember to breathe! A minute feels like an hour. Still better than the messing that can happen with private treaty though.

If its seen that you are genuinely interested in the first lot then hopefully it will go to subsequent negotiations, unless of course someone comes along with enough to buy the entire. Slim chance I think, the number of people with access to >€300k are very small now unless road/development money around. Good luck anyway and stay cool

The fact that auctioneers all know each other can be a help. They are in competition with each other, so they usually want to "get one up" on each other, so will try to buy as cheaply as possible:)
Sit at front and bid as you see fit is a great piece of advice for the novice auction-bidder, as is the instruction to BREATHE. I've seen guys nearly faint at auctions we've held...and no, 6600, that wasn't because I was trying to "squeeze" them:D
Not sure about being late, get there on time, 15 mins "grace" is our norm.
If you bid strongly and determinedly for your lot, then you may dissuade others. There is huge psychology at auctions.
Take an old fella or someone with you for support, if not advice.
Again, best of luck. let us know how you get on.
PS If it's anywhere near Clonmel, I might go and help you;)

sea12

poor farmer wrote: »

I would bid for lot 1 and also bid for the entire even if you don't want lot 2
It puts you in control.

Question for PatQ out of curiosity,

If you were the highest bidder but the property doesnt sell/ reach reserve, are you entitled to have first chance to negotiate with the auctioneer or is that just usually what seems to have.

Cavanjack

Would be no harm to ring the auctioneer before the auction, ask him what the reserve is, talk a bit of sh##e to him. Tell him your very interested in lot 1 but not the rest. That way if the entire is going for more than lot 1 + 2 there is more of a chance he will come back to you. Bid good and strong for lot 1 from the start. Best of luck

PatQfarmer

Cavanjack wrote: »

Would be no harm to ring the auctioneer before the auction, ask him what the reserve is, talk a bit of sh##e to him.

:D:D:D That happens all the time in our job!

PatQfarmer

sea12 wrote: »

Question for PatQ out of curiosity,

If you were the highest bidder but the property doesnt sell/ reach reserve, are you entitled to have first chance to negotiate with the auctioneer or is that just usually what seems to have.

No "entitlement" to anything, but it would be the norm.
I've had a lad come to me as I stepped off rostrum saying "I'll give you more for the land" and he hadn't even bid once during the Auction!
Usually, but not always, the highest bidder will be the best buyer on the day. If it goes to Private Treaty the following day, all bets are off.
If you want to buy something and if you have the finance sorted, on the day, at the Auction, is the day to buy.

PatQfarmer

Cavanjack wrote: »

Bid good and strong for lot 1 from the start. Best of luck

Best of advice!