Selling a House at Auction: A Guide for Sellers

News at Jones Robinson | 07/09/2023

Selling a house at auction can be a fast and effective way to achieve a good price for your property, especially if it is in high demand, has unique features, or needs renovation. However, it can also be a complex process that requires careful planning, preparation, and guidance. At Jones Robinson, we can help you navigate the auction process and achieve the best possible outcome for your sale. In this blog, we will explain how selling a house at auction works, what are the benefits and drawbacks, and how we can assist you throughout the process.

House auction

What is Selling a House at Auction?

Selling a house at auction is a method of selling property where you set a reserve price (the minimum amount you are willing to accept) and invite potential buyers to bid against each other in a public or online auction. The highest bidder wins the property and has to pay a deposit and sign a contract on the spot. The sale is then legally binding and must be completed within a set timeframe, usually 28 days.

Selling a house at auction differs from selling through the traditional route of private treaty, where you negotiate with one or more buyers through your estate agent until you agree on a price and terms. The sale is then subject to contract and can fall through if the buyer pulls out, fails to secure finance, or finds issues during the survey or conveyancing.

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Why Sell a House at Auction?

Selling a house at auction can have several advantages over selling through private treaty, depending on the type and condition of your property, the state of the market, and your circumstances. Some of the benefits of selling a house at auction are:

Speed: Selling a house at auction can be much faster than selling through private treaty, as the sale is completed within a few weeks of listing your property. This can be ideal if you need to sell quickly due to divorce, probate, debt, or relocation.
Certainty: Selling a house at auction eliminates the risk of gazumping, gazundering, or chain breaks, as the sale is legally binding once the hammer falls. This can give you peace of mind and avoid wasting time and money on abortive transactions.
Competition: Selling a house at auction can generate more interest and demand for your property, as buyers compete against each other in an open and transparent bidding process. This can drive up the price and achieve a higher value than selling through private treaty.
Exposure: Selling a house at auction can attract more attention and exposure for your property, as it is advertised widely through online platforms, catalogues, newspapers, and social media. This can reach a wider audience of buyers, including investors, developers, cash buyers, and overseas buyers.
Flexibility: Selling a house at auction gives you more control and flexibility over the terms and conditions of the sale, such as setting the reserve price, choosing the auction date, and deciding on the completion period.

What are the Drawbacks of Selling a House at Auction?

Selling a house at auction can also have some disadvantages, depending on the type and condition of your property, the state of the market, and your expectations. Some of the drawbacks of selling a house at auction are:

Cost: Selling a house at auction can be more expensive than selling through private treaty, as you have to pay for marketing fees, legal fees, auctioneer fees, and commission fees. These fees are usually non-refundable regardless of whether your property sells or not.
Risk: Selling a house at auction can be more risky than selling through private treaty, as you have no guarantee that your property will sell or achieve your desired price. If your property fails to meet its reserve price or attract any bids, it will remain unsold or be sold after the auction at a lower price.
Stress: Selling a house at auction can be more stressful than selling through private treaty, as you have to deal with uncertainty, pressure, and competition during the bidding process. You also have to prepare all the legal documents and arrange for surveys and valuations before listing your property.
Suitability: Selling a house at auction may not be suitable for all types of properties or sellers. Properties that are in good condition, have standard features, and appeal to a wide range of buyers may not benefit from selling at auction as much as properties that are in poor condition, have unique features, or appeal to a niche market. Similarly, sellers who are not in a hurry to sell or who have unrealistic expectations may not be satisfied with selling at auction.

How to Sell a House at Auction?

Selling a house at auction involves several steps that you need to follow carefully and with the help of your estate agent. Here is a brief overview of the process:

Choose an auctioneer: The first step is to choose a reputable and experienced auctioneer who can advise you on the best auction strategy for your property, such as the type of auction, the reserve price, and the guide price. You can find a list of accredited auctioneers on the website of the National Association of Valuers and Auctioneers (NAVA).
Prepare your property: The next step is to prepare your property for sale, which may include cleaning, decluttering, repairing, and staging it to make it more appealing to buyers. You should also obtain an Energy Performance Certificate (EPC) and a Home Report if you are selling in Scotland.
Prepare the legal pack: The legal pack is a set of documents that provide essential information about your property, such as the title deeds, the contract of sale, the searches, the special conditions, and any other relevant information. You should instruct a solicitor to prepare the legal pack and make it available to potential buyers before the auction.
Market your property: The auctioneer will market your property through various channels, such as online platforms, catalogues, newspapers, and social media. They will also arrange for viewings and valuations for interested buyers. You should cooperate with the auctioneer and provide them with any information or access they need.
Attend the auction: On the day of the auction, you or your representative should attend the auction venue or log in to the online platform. You should also bring your ID, proof of address, and proof of funds. You will then watch the bidding process and wait for the hammer to fall. If your property sells, you will have to sign the contract and accept the deposit from the buyer. If your property does not sell, you can negotiate with any interested buyers after the auction or relist it for another auction or private treaty.
Complete the sale: After the auction, you will have to complete the sale within the agreed timeframe, usually 28 days. You should instruct your solicitor to liaise with the buyer’s solicitor and exchange contracts and transfer deeds. You should also clear out your property and hand over the keys to the buyer.

How Can We Help You Sell a House at Auction?

At Jones Robinson, we specialise in supporting sellers selling your house at auction by providing you with expert advice, support, and representation throughout the process. Some of the services we offer are:

Valuation: We can provide you with a realistic, accurate and free home valuation based on its condition, location, features, and market trends. We can also advise you on how to set your reserve price and guide price to attract buyers and achieve a good sale price.
Marketing: We can help you market your property effectively by creating professional photos, videos, floor plans, and descriptions that highlight its best features and potential. We can also advertise your property on our website, social media, newsletters, and other platforms that reach a large and targeted audience of buyers.
Legal: We can help you prepare your legal pack by working with our trusted solicitors who have experience in dealing with auction sales. We can also ensure that all the legal documents are compliant with the relevant laws and regulations and are available to potential buyers before the auction.
Viewings: We can help you arrange and conduct viewings for interested buyers who want to inspect your property before bidding. We can also answer any questions they may have about your property or the auction process.
Auction: We can help you choose the best auctioneer for your property and attend the auction on your behalf. We can also communicate with you during the bidding process and inform you of the outcome. If your property sells, we can help you complete the paperwork and collect the deposit from the buyer. If your property does not sell, we can help you negotiate with any interested buyers or explore other options for selling your property.

Completion: We can help you complete the sale by working with your solicitor and the buyer’s solicitor to exchange contracts and transfer deeds. We can also help you clear out your property and hand over the keys to the buyer.

Contact Us Today to Sell Your House at Auction

If you are interested in selling your house at auction, please contact us today to arrange a free valuation and consultation. We will be happy to discuss your needs and expectations and explain how we can help you sell your house at auction successfully. We have a team of friendly and professional agents who have extensive knowledge and experience in selling properties at auction. We also have a network of reliable and reputable auctioneers who can offer you the best service and results. Whether you are selling a house that is in high demand, has unique features, or needs renovation, we can help you achieve a fast, certain, and competitive sale at auction.