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Option Homes Ltd - News- Selling Your Property via Auction

Selling Your Property via Auction

Date Added 04/04/2016

These days there are a multitude of options when it comes to selling our houses, from going through a traditional estate agent, selling privately or by selling online. However, one often overlooked method is to sell via auction. There are some big pros and cons for selling this way, so we`ll take a look at the process here so you can see if it`s something that may work for you and your own personal circumstances.

How a Property Auction Works

Once you have applied to the auction house and everything is agreed, the auction process can actually move quite quickly, certainly quicker than when you sell through an estate agent in a process that requires the house being advertised and then an anxious wait while offers either do or don`t come in. Once the agreement with the auctioneer is in place, the auction of the house will be advertised for a particular date. Then, once the date of the auction is announced, potential buyers will be able to view the property in advance of the auction so they can determine whether they want to bid. They will also be able to conduct any necessary surveys or legal searches.

On the day of the auction, the auctioneer will invite bids and if the reserve price is met (at the very least) then the sale is made. Obviously, in the case of competing bids then the highest bid wins. Once a bid has won, the buyer is required to immediately sign a contract to commit to buying the house and pay a deposit, usually about 10% of the agreed price. The full process is then completed within 28 days of the date of the auction.

Pros of Selling Property via an Auction

The main advantage of an auction is the time saved. It`s for this reason that vacant properties are often sold via auction to move them on as quickly as possible. Selling via auction will take a matter of weeks instead of months (or even years). Although it should be remembered that if a reserve price is put on the property then the chance remains that a sale won`t be made if nobody is willing to meet it.

Cons of Selling Property via an Auction

This is the big one you have to consider, because it is highly unlikely you will get a great price for your property selling via this method. Usually properties sold via UK auction houses might be sold at anything between 25 and 50% of their full value. This is in part due to the pressure of the time constraints and that any due diligence carried out by potential buyers has to be done quickly before the auction and at their own cost.

So selling property via auction is a serious option to consider, especially if time is of the essence. Of course, selling via one of the other means can ensure you get much closer to the value your property is worth, so it depends entirely on your circumstances.
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