When preparing to sell a property, many people opt to sell via an estate agency without realising that auction is an option too.
We can sell any type of property at auction, the biggest stipulation is that you must be in a position to vacate the property within 28 days after a sale is agreed (unless the property is being sold tenanted). In other words, the property can’t be sold as part of a chain.
The key differences between selling via auction and an estate agent are the speed and certainty of sale, as well as the valuation process.
Speed
Auctions have a fixed date of when a sale would be agreed (auction date). Properties can however be sold prior to the auction date if agreed by the seller.
An agreed sale through an estate agent can take place at anytime after they have been instructed to sell.
At auction, once a sale is agreed it becomes legally binding and legal exchange takes place. In contrast, via an estate agent, when a sale is agreed, there is no set deadline for exchange to follow.
Completion typically occurs up to 28 days after exchange at auction (and often much less). Again, there is no designated timescale for completion to take place after a sale is agreed. Data suggests that it takes on average six months for a property to complete via an estate agent.
Certainty
Due to the legal commitment to purchase, it is very rare for a buyer to back out of a purchase at auction once a sale is agreed. It is however estimated that around 30% of estate agency property sales fall through, costing the buyer time and often money.
Valuation
Another key difference is the way in which auctioneers and estate agents approach valuing a property.
It’s common for an estate agent to initially suggest a higher price and seek offers from buyers at or below the asking price. They may then advise the seller to lower the asking price, step by step, until buyer interest is generated.
An auctioneer will guide a property at a more attractive price which generates interests from multiple buyers; by doing so and using the bid up process in an auction environment, the final selling price for suitable auction lots will be similar to or exceed those achieved via estate agents.
Selling at auction isn’t a suitable solution for everyone, however for many, it is the smart choice!
If you have a property or land to sell, get in touch with your local auction team today for more information.
