First time buyers waste millions at 2006 property auctions

13-Jun-2007

First time buyers and others looking to buy a new home who inaccurately banked on winning property auctions lost over £22 million last year, it has been revealed.

Hidden costs such as pre-auction lawyer and surveyor fees mean that many buyers will be £1,000 down before they even begin bidding on a potential new home, auction site Humraz.com has found.

With the number of residential properties being sold at auction having risen by 132 per cent since 1997, more and more bidders face losing out, with Humraz estimating that at least 60 per cent of bidders spend £1,000 without ever securing their desired property.

Humraz has said that the properties it sells do away with the need for any professional services prior to auction.

"There is an element of risk involved in our auctions, but it's minimal compared with a traditional property auction. Furthermore, given that our properties will always sell for less than five per cent of their market value, the reward is much greater too," commented the website's founder Asmat Monaghan.

There was a 20 per cent rise in the number of homes offered for sale by auction in the first three months of 2007, recent research has found.

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