Selling Your Property - Selling at Auctions

Some people choose to sell their property at auction. There are several reasons for doing this, but the main one is the speed at which the sale will go through - the sale completes 28 days after the auction date. Also provided your property meets the reserve price, you are guaranteed a sale as the contract is binding on the fall of the gavel. One of the biggest advantages of selling this way is the potential for a bidding war between interested parties pushing the price up much higher than your expectations.

Once you have found a local auctioneer who holds property auctions they will want you to enter into a sole agency agreement with them. You may be asked to contribute to the marketing costs of your property as well as their standard commission on the sale which is usually charged at 2.5%. You will need to find out what the costs would be if you did not find a buyer at the auction, or withdrew your property before the auction.

Before you put your property into the auction you will need to have it valued either by an estate agent or a qualified property auctioneer. The auctioneer will then be able to guide you towards a reasonable reserve price and to set a guide price. The reserve price is confidential between you and the auctioneer.

You need to instruct your solicitor to prepare the contract and any special conditions of the sale which must be included in the auctioneer’s brochure, so these must be ready before the brochure is published. The property will need to be available for viewings by any prospective buyers. You will also need to make the property available for surveyors as the buyers carry out surveys and mortgage valuations in advance of the auction.

You may need to put together an information pack for interested parties. Your auctioneer may advise you to include a survey with the pack along with the property details and any relevant information. You may have to pay for local authority and land registry searches - all of which is in line with the government’s new proposals for Seller’s packs.

Buyers may choose to contact you direct prior to the auction date in order to put in an offer. If you accept this offer you need to be sure of the costs that you will incur from the auction house.

The main disadvantage of selling at auction is the possibility that you may only just make your reserve price or not find a buyer on auction day. If this happens, you will either have to start again putting your property up for the next auction - and pay the costs again - or use a different strategy to sell your property. For this reason it is a good idea not to have committed to a property purchase elsewhere if you need the sale to have gone through to finance the new purchase. Another disadvantage is that it is often more expensive to sell your property at auction than through an estate agent. You may also have to pay for your solicitor’s time to come to the auction in case of any last minute queries.

More Selling Your Property topics below:

• Selling in Scotland - the process of selling your property in Scotland
• Estate Agents - what can you expect from an estate agent?
• Private Sales - avoiding expensive estate agents fees
• Viewings - what you should say, what you should answer and what you should ask.
• Offers - how can you tell when an offer is the highest you will get?
• Surveys - as a seller, what can you expect from the survey?
• Legal - what is involved with conveyancing for sellers?
• Financial - what can you expect to be paying for when you sell your property?
• Selling Pack's - how the government proposes to speed up the property buying process
• Moving - what you should organise in order to have as easy a move as possible.

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