Q: Is selling at auction worth considering?
A: Very much so. Traditionally, of course, this rather depended on what you were trying to sell. Here in the UK, auction always tended to be reserved for those properties where the normal method of sale by private treaty was less likely to produce the best price: for example, land, or properties requiring substantial renovation or remedial work, short leasehold properties, and houses suitable for conversion.
However, that is changing. There is plenty of evidence around the country that auction has moved forward quite significantly in the last twelve months, and that it is no longer seen as the exclusive preserve of the bargain-hunter or investor.
Of course, traditional lots are still selling well in the sale room. However, in recent months, there has also been a rise in the number of more “normal” properties coming up for sale at auction. This is generally happening in cases where the seller needs either speed or certainty – or both. This can be for a wide variety of reasons: in probate cases, for example, or where sellers may have a deadline to meet, such as a job move or children moving into a new school catchment area. In other words, people who do not necessarily have the luxury of hoping that a sale by private treaty will be concluded within their desired time frame.
And all this, of course, is happening against a background in which the lack of liquidity in the mortgage marketplace has seen a rise in abortive transactions, and new mortgage business is still at an historic low.
Another key factor helping to bring auctions more into the mainstream market is the growth in the number of auction houses offering new-style conditional contracts. As with traditional contracts, these still become legally binding on the fall of the auctioneer’s gavel – thereby offering that all-important certainty. However, they require a much smaller deposit from the successful bidder on the day – and instead of the standard 28 days to completion, they allow anything up to 60 days. By providing more time to secure the necessary finance, this has opened up the auction marketplace to regular buyers as well as investors.
Of course, as always, anyone looking to sell their property should take advice on the best method of sale from their chosen estate agent – but certainly, auction is increasingly becoming a viable option!
Mike Partridge is the owner for Partridge Estate Agents who are members of thebestof Exeter. Find out more about them here