selling houses by auction - n/g | Vital Football

selling houses by auction - n/g

wxgill

wxgill

Vital 1st Team Regular
My neighbours across the road sold their house by auction and moved back in with friends while waiting for completion.

They got the money today and all they had to pay for including an "auction pack" was £2150. The buyer spends a lot in costs this way - they told me.

They are now cash buyers and are moving to Yorkshire to be with family.

From day of auction to today was only 3 weeks. They put a reserve of £380,000 on the house but got £387,000 in the end.

Seems like a very quick and cheap way to sell.

IF it really is that easy how come Estate Agents are still making a living?
 
wxgill said:
My neighbours across the road sold their house by auction and moved back in with friends while waiting for completion.

They got the money today and all they had to pay for including an "auction pack" was £2150. The buyer spends a lot in costs this way - they told me.

They are now cash buyers and are moving to Yorkshire to be with family.

From day of auction to today was only 3 weeks. They put a reserve of £380,000 on the house but got £387,000 in the end.

Seems like a very quick and cheap way to sell.

IF it really is that easy how come Estate Agents are still making a living?
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Risks for the seller: you don't know how much you're going to get, or even whether it will sell at all - which for people who can't afford to be homeless, makes it very difficult to plan the next purchase.

Risks for the buyer: legal and survey fees down the drain if you're outbid; lose your deposit if you can't complete within 28 days, which is stressful unless you have the funding lined up before the auction; limited choice; very difficult to coordinate if you're selling in a chain.

I think auctions are pretty good if you're buying as a developer or BTL landlord with spare cash, or selling with no time pressure. But for most normal situations where there's a chain in one direction or both, I can't see them as a good option.
 
AbsoluteCarnage said:
Risks for the seller: you don't know how much you're going to get, or even whether it will sell at all - which for people who can't afford to be homeless, makes it very difficult to plan the next purchase.

Risks for the buyer: legal and survey fees down the drain if you're outbid; lose your deposit if you can't complete within 28 days, which is stressful unless you have the funding lined up before the auction; limited choice; very difficult to coordinate if you're selling in a chain.

I think auctions are pretty good if you're buying as a developer or BTL landlord with spare cash, or selling with no time pressure. But for most normal situations where there's a chain in one direction or both, I can't see them as a good option.
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The "auction pack" included searches. Provided by the seller.

The seller put a reserve on it so it could only sell for their minimum price or not at all.
 
wxgill said:
The "auction pack" included searches. Provided by the seller.

The seller put a reserve on it so it could only sell for their minimum price or not at all.
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Yes, but if you're trying to get a mortgage, or want peace of mind as a potential cash buyer, you need a survey. That's not the same as searches.

What would your neighbours have done if the house hadn't sold? At auction you basically get one shot at selling (or one every couple of months), unlike going through estate agents who will keep it on the market indefinitely.

I'm not particularly a fan of estate agents - the last time I sold a house, I basically did their job for them and so resented every penny we paid in commission - but I think they're more likely to be displaced by online agencies than auctions, for the mass market.
 
I have seen houses advertised in the columns of local papers, so why even pay the £2,150 if it is that easy?

I suppose it depends on what sort of house you are trying to sell. I tried to sell my first house, a basic starter terrace in Ashford, in 1989 just at the start of a housing slump and put it with a property shop, Seekers, paying £250 up front. It was in their window for a while but then became less actively marketed. Eventually in 1994 (yes, really) I realised the truth and put it on with Wards who found me one buyer that fell through and then shortly afterwards my eventual buyer. Wards also sold our Bungalow this year for £10k more than the advertised price.

After my dad died, my mum needed to sell their unique detached bungalow and the estate agent found enough willing buyers (four) to set up a sealed bid arrangement where the top bid was over thirty grand more than the lowest bid, as well as the advertised price.

On Homes under the Hammer on TV there are often auction buyers that say that they had been interested in the property for some time and had made offers that had been declined, but then heard it was going to be in an auction and picked up the property for LESS than they had offered privately.

I am not singing the praises of all Estate Agents but in the recent market they do bring in a lot of punters and have lists of people looking for particular "identikit" properties so are ready to view straight away. Buyers therefore often have to pay over the advertised price to secure them, much like an auction but with more time to complete and less time in rented.
 
The auction process was dealt with via an estate agent. That's who they paid the money to.
 
wxgill said:
The auction process was dealt with via an estate agent. That's who they paid the money to.
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The Auction fees would not have ben refundable if the property didn't sell.

Looking at an Auction report a couple of months ago something like 15% of the properties did not sell.
 
Bert said:
The Auction fees would not have ben refundable if the property didn't sell.

Looking at an Auction report a couple of months ago something like 15% of the properties did not sell.
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They were told if it didn't sell it would be entered into the next one (every 2 weeks).
 
AbsoluteCarnage said:
Yes, but if you're trying to get a mortgage, or want peace of mind as a potential cash buyer, you need a survey. That's not the same as searches.

What would your neighbours have done if the house hadn't sold? At auction you basically get one shot at selling (or one every couple of months), unlike going through estate agents who will keep it on the market indefinitely.

I'm not particularly a fan of estate agents - the last time I sold a house, I basically did their job for them and so resented every penny we paid in commission - but I think they're more likely to be displaced by online agencies than auctions, for the mass market.
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A good estate agent is worth every penny, an intermediary is useful for getting a mutually beneficial deal.
 
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