Minimizing the Risks of Buying Auction Properties

As with any type of transaction, buying from the auction has its own risks. Know the risks involved and take a calculated risk before going to an auction.

1.You do not get to view the property’s internal condition, and if the property is in bad shape, you may have to fork out extra money for repair and renovation works

If the property is tenanted, you may try to ask the tenant if they allow you to take a quick look at the property. If the property is owner-occupied, you may also ask the permission of the owner to take a quick view of the property, and at the same time, you might also wish to check if they are already prepared to vacate the property. Do expect some hostile treatment. You may also wish to consider speaking to the neighbors, they may be able to give you some valuable information.

2.The property may have many outstanding utility bills left unpaid and you may have to quantify it

Before the auction date, do ensure you or your agent goes to the relevant utility offices, such as Tenaga Nasional Berhad, SYABAS, management office, with a copy of the POS to check on the outstanding bills.

3.You may have trouble evicting previous occupants

Once you are the official owner of the property, you can then engage a lawyer to distress the occupant and then apply for a court order. Always check if the property is occupied before the auction.

4.The property may have a caveat 

Ensure you or your auction agent do a title search for properties with the title.

Whether you’re a property investor or a first time home buyer, the auction property market has something for everyone. Familiarize yourself with the process, ensure you do a thorough investigation of the property to get a better picture of the costs involved to ensure you get a great deal!