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Buying repossessions

How to bag a bargain and what to watch for

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Helen S | Edited by Johanna

Updated November 2016

It’s possible to pick up repossessed or distressed properties at up to 30% off the market price. If you're willing to put the work in these can represent some of the best buys available.

This quick guide runs through how it works, how to find bargain properties, using the top auction houses and more.

Buying repossessions - essential info

Buying a repossed or distressed property can be a minefield so make sure you do plenty of research beforehand. Here are our top tips to set you off to a good start:

Banks want to flog repossessions quick, so you can bag a bargain

Homes being flogged after repossession can go mega-cheap, because the seller - usually a bank or developer - is after a quick sale... Full info

This isn't just about doer-uppers - you could bag a new build too

Many repossessions were previously owned by borrowers who fell behind on mortgage payments. But others are new-builds and... Full info

You can cut up to 30% off the market value

Prices are anything between 10% to 30% off market value - usually the more work they need, the bigger the discount, although... Full info

Don’t buy a wreck on a whim

Your best bet is to visit the property several times, crucially, with a solicitor or surveyor. There are properties out there for under £20k... Full info

Struggling with mortgage debt?

If you’re here because you're struggling to keep up with mortgage payments, read the Mortgage Arrears Help guide. For those under threat... Full info

Quick repossession buying tips

'Repossession' doesn’t always mean 'bargain'. It's essential to view other properties and research the area thoroughly, just as you would with any other new house.

How to bid at auction

Property is very expensive and you need to know what you're doing before bidding. Here is a step-to-step guide on how to bid at an auction, although, this is just a brief guide. There are a number of good books on the subject that are worth reading beforehand.

If you've tried to buy an auction property, we'd love your feedback on the process. Please leave your comments in the forum's Buying Repossessions discussion.

Where can you find out about house auctions?

Auction houses that deal in repossessions have always been the favourite hunting ground of property investors. Yet because of the recession, a number of specialist websites have sprung up too. There's no perfect pick - they all have pros and cons, so please send us your feedback.

Auction houses
Auction houses

If a bank can't offload a property through an estate agent, often it'll go to auction for a quick sale (sometimes they don’t even bother with an agent). Several auction houses and agents auction off repossessions, including Allsop, Savills and Barnard Marcus.

Some of these let you filter web searches for repossessed homes, or else you can just call up to see what they have on their books. Handily, Allsop also lets you search for completed auctions, a good way to glean a home’s market rate.

How you buy: Search for properties online or on the auction house's catalogue. If you spot a potential property, attend that day's auction.

Local papers
Estate agents & local papers

Often estate agents sell off repossessed homes, but don’t advertise. Call them up and ask what they have on their books. Another way is checking the back of your local paper for announcements.

Some auctions get nothing but a small ad. The fewer house-hunters that know about a home, the more likely you are to get a great deal.

How you buy: Ask to view as normal.

Paid-for services
Paid-for services

If you seriously fancy yourself as the next Sarah Beeny, there are paid-for sites that source repossessed properties for you. These are not recommendations, but are listed here in case people want to find out more.

Property consultancy PropertySecrets sends out emails with bargain properties for subscribers at a cost of £15.99/month. Or, Eigroup has a huge database of property auctions, but is a pricey £395 plus VAT a year. London-only Capital Property List sends out an email with a list of repossessions and homes from distressed sellers, from £89 for three months.

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