How to buy a house at auction: the complete guide
Auction purchases are legally binding the moment the hammer falls - no surveys, no finance conditions, no second chances. How to buy safely, and the costs most first-time bidders miss.
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Buying at auction can mean a genuine bargain - but the rules are brutal: when the hammer falls, you are legally committed. No survey clause, no mortgage condition, no cooling off (in a traditional auction). If you can’t complete, you lose your deposit. Here’s how to do it without getting burned.
The two types of auction
| Traditional auction | Modern method | |
|---|---|---|
| When you’re committed | Immediately, at the fall of the hammer | When you exchange (up to 28 days after) |
| Deposit | 10% on the day | 5–10% reservation fee |
| Completion | Usually 28 days | Usually 56 days |
| Cooling-off | None | Yes, for 14 days (usually) |
| Best for | Repos, probate, true bargains | Sellers wanting a longer timeline |
The costs beyond the hammer price
- Buyer’s premium - the auction house’s fee, typically 1.5–5% + VAT of the hammer price. On a £200,000 lot that’s £3,600–£12,000. Often buried in the small print
- Deposit - 10% payable on the day (bank transfer or card limit applies)
- Legal pack - review it before bidding; your conveyancer’s review typically costs £200–£500
- Searches - you pay for these before the auction; they don’t come after
- Survey - same: order it before you bid, not after
Financing an auction purchase
Lenders are slow; auctions are fast. If you need a mortgage, get a decision in principle before the auction and tell the broker it’s for an auction - some lenders have auction-specific products and turnaround times. Cash buyers have a huge advantage. Never bid assuming you’ll “sort the finance out after”.
The pre-auction checklist
- Read the legal pack in full - title, lease, searches, special conditions
- Instruct a conveyancer to review it in writing (this is non-negotiable)
- Book a survey - a Level 2 for most homes, Level 3 for anything older
- View twice - once in daylight, once for the neighbours and street
- Set your maximum - including premium, fees and repairs - and do not exceed it
- Check the auction house’s fees - premium, VAT, admin charges, card limits
- Arrrange finance (or have cash) before the catalogue closes
Done properly, auctions are one of the few places a buyer can genuinely beat the market. Done carelessly, they’re the fastest way to lose a five-figure deposit. The difference is entirely in the preparation.
Source: MoneyHelper - buying at auction — Process and costs guidance checked August 2026
The buying process, step by stepHow an auction purchase differs from the standard route.Which survey do you need?Order the right survey before auction day.
Sources
- MoneyHelper - buying at auction - Process and costs guidance checked August 2026
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