Introduction
Auction day is the final stage of the buying process, and preparation is essential to ensure everything runs smoothly. Understanding how bidding works and what is required if you are successful will help you participate with confidence.
This guide explains what to expect on auction day, how to bid, and what happens if your bid is accepted.
Property Auction Day — Bidding at Commercial Property Auction
On auction day there are several key points to remember. Preparing in advance will help ensure you can bid without complications and complete the purchase if successful.
Before attending the auction, you should ensure the following:
1. Deposit Funds Available
You must have access to funds to pay the deposit immediately if your bid is successful. Deposits are typically 10% of the purchase price, although some auctions may require a fixed minimum amount. Most auction houses now accept bank transfers or debit card payments rather than cheques.
2. Proof of Identification
Auctioneers are required to carry out anti-money laundering (AML) checks. You will usually need two forms of identification, including:
- Photo ID (passport or driving licence)
- Proof of address (utility bill or bank statement)
3. Solicitor Details
You will need to provide contact details for your solicitor or conveyancer so contracts can be issued immediately after the sale.
4. Order of Sale Confirmation
On arrival, you should check the Order of Sale to confirm that the property you are interested in has not been withdrawn or postponed. This can also be checked in advance with the auctioneer.
5. Addendum Updates
The Addendum contains any last-minute changes to the legal documentation or conditions of sale. You should review this carefully before bidding.
Arriving and positioning yourself
It is advisable to arrive early to register and familiarise yourself with the auction environment.
If attending in person, choosing a position where the auctioneer can clearly see you is helpful. Observing other bidders can also provide useful insight into the level of interest in particular lots.
Many auctions now operate in hybrid formats, meaning bidding may take place both in the room and online simultaneously.
How bidding works
When the auction begins, the auctioneer will introduce each lot and invite bids.
You can bid by:
- Raising your hand or catalogue
- Using a numbered paddle issued by the auctioneer
- Online bidding platforms
- Telephone bidding arrangements
The auctioneer will continue to invite bids until no further offers are made. When the hammer falls, contracts are exchanged immediately.
It is important to remember that once the hammer falls, the purchase becomes legally binding.
If you have any uncertainty about the property or your finances, you should not bid.
What happens if you are the successful bidder
your bid is accepted, you will normally be required to:
- Provide identification and solicitor details
- Sign the memorandum of sale
- Pay the deposit immediately
- Pay any buyer’s premium or administration fees
Completion usually takes place within 20 to 28 working days, depending on the auction conditions.
Remote and online bidding
If you are unable to attend in person, most auctioneers offer alternative bidding methods.
These may include:
Telephone Bidding
The auctioneer contacts you during the lot and relays bids in real time.
Proxy Bidding
You submit a maximum bid in advance, and the auctioneer bids on your behalf up to that amount.
Online Bidding
Many auctions now take place entirely online or with integrated digital bidding platforms.
For remote bidding, registration must usually be completed in advance and may require:
- Identification documents
- Proof of funds
- Deposit authorisation
- Signed bidding forms
Registration deadlines often apply, so arrangements should be made early.
Key Auction Risks to Remember
Auction purchases involve commitment and speed.
Important considerations include:
- No cooling-off period after the hammer falls
- Limited time to complete
- Financial penalties for failure to complete
- Responsibility for due diligence lies with the buyer
Careful preparation is essential to reduce risk.
Summary
Attending and bidding at a commercial property auction can be straightforward when you are properly prepared. Ensuring finances, identification, and legal arrangements are in place before auction day allows you to bid confidently and complete the purchase without difficulty.
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