28th June 2023

A Guide to Buying Land at Auction

If you’re an individual interested in building your dream home on your own plot, a developer with a vision to turn an empty area into a thriving hub of activity, or an agriculturalist looking to develop land, land auctions are an excellent way to expand your existing portfolio.

Just as with purchasing a building, there are several considerations that require thorough research in order to make an informed decision before purchasing land. At first, this may seem overwhelming, but our guide will take you through the process to prepare you for what to expect and how land auctions work. 

Finding land to buy

Naturally, the first step is looking for land to buy. To do this, we’d recommend looking for upcoming auctions and choosing dates that will allow enough time to conduct thorough research into the viability of the land for your project. Once you have chosen your dates, browse through the available lots and download all of the information to review before deciding whether you want to pursue this option and view the land in person. Alternatively, you can browse through the plots of land available in our Timed Auctions, once again being sure to allow enough time to investigate before bidding.

It is worth viewing the land on Google Maps before making your decision, as you’ll be able to see a clearer picture of influencing factors such as road access and existing nearby buildings. When it comes to both in person and online viewings, here are some of the things you’ll need to consider to ensure the land is suitable for your project:

The plot

You will need to take an in-depth look at the positioning of the property. Firstly, site access will need to be considered. Will you be able to access the land by a public road or will you have a private road to access the property? In the case of the latter, this may need to be maintained at your own expense. Additionally, you’ll need to think about whether the land is the right size and dimensions for your project. The plot may be large enough to accommodate a building, but not large enough for off-street parking, turning vehicles or for construction access during the initial build.

In some cases, if the land you are interested in is adjoined to another plot of land, there may be an issue with what is known as a ‘ransom strip’. A ransom strip is where you may have to cross someone else’s land to access yours, and the vendor may legally block you from doing this until you have essentially paid the ransom. Your solicitor should check for this, but it will be worth scoping out any potential issues before they arise. It is not advisable to cross the ransom strip without explicit permission as this could be considered trespassing.

Finally, and arguably most importantly, will the plot of land be able to be connected to the electricity grid and water supply? Most projects will warrant the use of utilities, and very remote areas of land may not be able to accommodate this.

Wildlife

We must remember that, no matter the official owner in the eyes of the law, our land is shared. Choosing a plot of land that houses endangered or protected plants and animal species may result in the refusal of your planning permission. You will need to read the legal pack thoroughly and carry out your own research as to whether you’ll encounter any issues.

Landowners may also be responsible for the management of certain wildlife elements of their land, especially if there is woodland on the plot. You will need to make sure you are prepared for this if your chosen plot has these features, as incorrect management could result in you breaking the law.

Location

Similarly to buying a house, the value of land can be subject to its location. Land within a short distance of a city or town may command a high price unless the land is deemed to be brownfield, which in some circumstances may lead to a cheaper price. All of this information will be made available to you, but it is up to you to research the land and see whether the costs would be within your budget. 

Ground Conditions

Before starting your project, it is vital that you ensure the ground conditions are adequate for your needs. After viewing the land in person, arrange for a land survey to be completed with the focus being your intended use. For example, if you are planning to cultivate the land, soil type, quality, drainage, flooding risk, and soil contamination will need to be considered. For construction purposes, you need to be aware of any slopes, flood plains, and whether the soil is suitable for building. 

Of course, some of these issues can be fixed if you still wish to pursue the land, but they will add extra costs to your budget. However, by buying land at auction you may be able to save on costs depending on the level of interest in the plot. 

Buying land with planning permission

If a plot comes with existing planning permission, this can be an indicator that your plans will be accepted, especially if your vision is something similar to the specified development in the planning permission. However, don’t feel constrained by these permissions if they’re not exactly what you had in mind, as you are able to scrap these plans and re-apply with your own. 

Land that is next to or close to existing buildings may be more likely to approve planning permissions due to the factors mentioned above. Wildlife, access, and utilities are less likely to be an issue if there are buildings close by. Additionally, one tip for those building a house is to look at the sizing of the houses nearby and opt for something similar. The way that houses are valued means that it is less economical to develop a house that is disproportionate to those surrounding it. You can end up over-developing, that is spending more money on a house than you could ever sell it for; or under-developing, where building too small a house is failing to realise the full potential of the site.

Looking at historic local applications for planning permission and analysing which have been successful (and unsuccessful) and why will give you a good idea of whether your potential plan would be successful when submitted to the council.

Preparing to buy land at auction

Once you have found your ideal plot of land, you should have collected lots of information regarding the property and have thought the process through extensively before the auction day arrives. It is worth noting that the type of auction you are registered for will affect the bidding process, and you’ll need to pick the right format for you. 

At SDL Property Auctions, land is sold through two different types of auctions that you can register for. The first type is timed auctions, which happen exclusively online. During these auctions, you can bid on your chosen property at any time until the end date, in this case, you’ll have a longer time to bid but you will need to monitor the progress to outbid other interested parties. In timed auctions, if a bid is made within the last 15 minutes of the auction, the auction will be extended by another 15 minutes to ensure a fair chance for all parties. The second method is auction events, which are live-streamed auctions, which more closely follows the format of a traditional auction. Since it is live-streamed, you don’t need to attend in person and can bid remotely. You will need to find a date that is suitable for you in order to participate in the bidding process and register to bid by proxy, online or by phone. 

Leading up to the auction event, make sure that the property is still available as sometimes the vendor may have withdrawn or sold the land in a different way. If the property is still for sale, register for the event and choose which bidding method you’ll be using (by phone, internet, or proxy). Set a defined budget, and stick to it on the day. It can be easy to get carried away when buying land at auction, but remember that you’ll need your funds for construction or development, so it’s important to budget accordingly in advance. If your bid is successful, a deposit will be required immediately, and other legal fees may also be incurred which will be detailed in the legal pack, so ensure that your budget has accounted for this and the funds are made available. 

Finally, don’t be disheartened if your bid isn’t successful, there are plenty more viable options available, in some cases it may just be that the reserve price wasn’t met – in which case you may be able to still make an agreement with the vendor after the auction has ended.

Purchase your plot with SDL Property Auctions

Remember that not all land is equal, which is why we’ve outlined all of the key considerations you’ll need to include in your research when looking for a suitable plot. 

Whether you’re looking to attend one of our upcoming live-streamed auctions for land or have your eye on a plot in our Timed Auctions, you will be able to browse through available lots in our online Property Finder. We also publish our past auction results as soon as they’re available for you to analyse the results to gauge interest and feel for land auctions. This can help to give you a better idea of what to expect depending on the type of land you’re interested in.

If you have any further questions about the process of buying land at auction, don’t hesitate to contact us with your queries.