| As the property investment game gets more | | | | market value - far from it! |
| challenging, the only sensible way to add to your | | | | The other way to do it is to use what might be called |
| portfolio in this environment is to buy properties | | | | "vulture tactics". |
| significantly below market value. Do this properly, and | | | | Rather than spend all that time and energy scoping out |
| you'll find you don't need to put in any money of your | | | | possible BMV properties only to be out-bid by |
| own. | | | | 'amateurs' who don't understand the true worth of a |
| The mortgage companies want you to find 15% of the | | | | property, or who want it at more or less any cost, you |
| purchase price every time you buy! Where on Earth | | | | just sit back and relax. Then, when the auction is over |
| do they think you have all these 15%'s stashed - under | | | | and the bidders have all gone home, you take a |
| the floorboards? | | | | leisurely look at whatever lots are left unsold. |
| This article will take you into the world of the below | | | | Just look at the advantages of this strategy... |
| market value (BMV) investor, and show you how you | | | | * You only spend time and money researching the |
| can free yourself forever from the shackles of the | | | | properties that are definitely still available |
| 15% deposit. | | | | * You know the asking price without having to bid |
| You must first understand that it is perfectly possible | | | | * The competition for properties is significantly less |
| to buy BMV properties, no matter which area of the | | | | * The 28-days-to-complete rule usually disappears |
| UK you live in, and almost regardless of your own | | | | There are three ways you can get hold of unsold |
| financial circumstances. There are below market value | | | | auction lot details. |
| properties for sale all over the UK, all the time. The | | | | 1. Direct From the Auction Houses |
| challenge is tracking them down and adding them to | | | | You may have a couple of auction houses in your |
| your portfolio. | | | | area, and you could always ask them to send you |
| There are two main ways to find BMV properties for | | | | details of unsold lots as soon as a sale is over. The |
| sale in the UK. One is through auctions, and the other is | | | | larger firms now publish them on their website, too. |
| to track down motivated sellers yourself. In this article, | | | | 2. From the EI Group |
| I'll be concentrating on auctions - we'll leave the | | | | David Sandeman does a great job at the EI Group. |
| tracking down to another time! | | | | They collate all the property auction data from around |
| People and organisations choose to sell through a | | | | the country, and their records go back as far as 1991. |
| property auction for two main reasons - speed and | | | | However, a subscription costs around £500 a |
| certainty. It generally takes no more than eight weeks | | | | year, so you need to be pretty committed to make |
| at the most, and sometimes considerably less, to go | | | | that sort of investment worthwhile. |
| from the decision to sell a property to the auctioneer | | | | 3. Subscribe to the Property Bargains Bulletin |
| taking bids for it in the auction room. | | | | Leo Summers has produced the Property Bargains |
| If the vendor sets a reserve - the minimum price | | | | Bulletin since 2005, and what he does is unique. The |
| they're happy to accept - and the reserve is met or | | | | Bulletin is emailed out to subscribers twice a month, |
| exceeded on the day, then the property is sold the | | | | and each issue covers 8-12 bargain property |
| moment the auctioneers gavel falls, and the deal will be | | | | opportunities. You get a photo of the property, the full |
| completed within 28 days. | | | | address, contact details for the selling agent, the price |
| No pulling out. No quibbling. No question. | | | | of the property against it's true market value, details of |
| As a BMV investor, you can get the auction | | | | any income it's bringing in, and a full page of analysis as |
| catalogues from auction houses in your area, research | | | | to why the property is a bargain, some ideas as to |
| potential properties, do your due diligence, turn up at | | | | what to do with it, and any potential pitfalls identified. |
| the auctions, bid on your target properties, and then go | | | | All this for less than a pub meal a month! |
| ahead and complete on the deal within 28 days (or risk | | | | Now you know exactly how to find BMV properties at |
| severe financial penalties). | | | | auction, and particularly amongst unsold auction lots. In |
| All of this takes time, money, resources, a certain | | | | a subsequent article, we'll look at how to track down |
| amount of skill and, if you're out-bid on the day, it's all | | | | motivated individuals who will happily sell you their |
| for nothing and you have to start again. And let's be | | | | property at below market value prices. |
| clear - not every property sold at auction sells below | | | | |