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Buying property at auction can offer fantastic investment opportunities, but it also comes with risks. Once the hammer falls, the sale becomes legally binding, so one of the most important steps in property auction due diligence is understanding the likely value of the property before you bid.
One of the most effective and affordable tools available is an Automated Valuation Model (AVM).
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What is an AVM?
An Automated Valuation Model (AVM) uses a combination of property data, comparable sales, market trends and sophisticated algorithms to provide an estimated market value for a property.
Many UK mortgage lenders use AVMs as part of their own underwriting process, making them a trusted and widely accepted method of assessing property values. They provide a highly reliable indication of what a property may be worth.
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Why Use an AVM Before an Auction?
When buying at auction, time is often limited. Investors need to make informed decisions quickly, and an AVM can help provide valuable insight before you commit to bidding.
The benefits include:
- Understand the likely market value before deciding your maximum bid
- Identify potential overpricing, helping you avoid paying more than a property’s estimated value
- Assess mortgage suitability, as many lenders rely on the same technology when considering lending decisions
- Increase confidence when making fast-paced auction decisions
One of the biggest challenges with auction purchases is that there’s often very little time to arrange a traditional valuation before the auction date.
An AVM provides a fast and cost-effective way to gain valuable information before you bid.
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Our AVM Service
At Advocate Finance, using the same system relied upon by many mortgage lenders, we can arrange an AVM for just £50 per property. This small investment can provide greater clarity and confidence before you start bidding.
If you’re assessing multiple auction lots, discounted pricing may be available for additional properties, please contact us to discuss your requirements.
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A Valuable Part of Your Due Diligence
An AVM should be considered one part of your overall due diligence process, alongside the legal pack review, understanding any planning or title issues, estimating refurbishment costs and considering your exit strategy.
For a relatively small investment, an AVM can provide valuable reassurance and help you approach auction purchases with greater confidence.
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How can Advocate Finance help?
If you’re considering bidding on a property at auction, we can provide a fast AVM report to help you make a more informed decision before auction day.
Get in touch to discuss your requirements, and if you’re reviewing multiple properties, ask about our discounted rates for additional AVM reports.
We provide a FREE assessment on all our services.
Please contact me directly for more information, or use the Get in Touch With Us Today feature at the bottom of this page.
