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Auction Properties

Pros and cons of selling at an auction

There are many ways to sell a house, but selling the conventional way (through an estate agent), is not always a success and can lead to total frustration. One option that can work is selling a property through an auction, a concept with numerous advantages, yet it is often seen as a final roll of the dice.

The advantages of property auctions lie in the fact that it is usually suited to the kinds of properties that require a quick sale. These properties could be repossessed, so a quick sale is required to cover any outstanding debts. Furthermore, there are properties that are unique and hard to value, properties better suited to an auction. Maybe a property is in high demand and therefore, at auction it can begin a bidding war so that a higher value is gained. Perhaps the property is struggling to sell via an estate agent due to its condition. At auction, someone may attend who has the funds in place to purchase the property and cover the costs of the renovations.

As mentioned, one of the biggest advantages is the potential of beginning a bidding war. If there is more than one party in attendance, then the price can quickly spiral out of control and the property can achieve a higher value than originally forecast. Once the auction is completed the sale is pretty much sealed. 

However, the disadvantages of selling via auction far outweigh the advantages. For starters, there is a prevelant invasion of privacy. Leading up to the auction, you are obliged to allow all the parties to view the property and make it accessible to surveyors who have been asked to value it by their clients. Furthermore, there is still the need to market the property in order to drum up interest from possible investors. This can be inconvenient and time consuming.

Whilst a value is given to the property before the auction, this is merely just a figure from which auctioneers and potential buyers work from. The real value of the property is decided on the day, when it is only worth what people are willing to pay. Therefore a lower price could be achieved, unless a reserve price is implemented. Using this method also makes it difficult to purchase another property, as relying on the funds raised from a property sold at auction is risky. There are high fees involved when selling via an auction, and it is not the cheapest way to sell. The auctioneer will take a percentage from the sale and this fee can be hidden so it is extremely easy to get caught out by it. There are usually vendor's fees involved, which also have to be taken into consideration.

The costs are typically higher than what an estate agent would charge which can be very off-putting. As with all property sales there has to be a solicitor involved but when selling at an auction there is usually a need to have a solicitor present so that any questions can be answered and the contracts can be signed. This can prove expensive as they will charge for any additional time spent at the auction as well as travel costs. Depending on the reason for selling at an auction, as it is a relatively quick turnaround, this can be a disadvantage as it can mean having to make sure that you are completely organised and ready to move within the usual 28 days. There are often people looking for bargains, and are often looking for properties that have structural defects that are a commonality in auctions as sellers often have trouble selling properties the usual way.

Overall, there are many reasons to sell at an auction that run parallel to the reasons why it is not worth selling at an auction. However, at buymypropertyforcash.co.uk, we offer a quick and simple process that can be far easier and efficient than selling at auction, as we will take any property, regardless of the condition or type. And best of all, we are the buyers! istock-auction-shot