Over the recent years property auctions have managed to gain an unprecedented popularity among both sellers and buyers. This is hardly surprising when you take into account the wide variety of advantages that this process presents. When it comes to the exact kind of properties that are eligible candidates for been put on auction, the list is a bit long.
What properties can be sold at auction?
To begin with, an auction can be a practical solution for houses that are unconventional, where arriving at an ideal asking price tends to be complex. Properties that stand in need of major renovations or even modernization are also excellent candidates for been put on auction. Along with houses whose owners want to execute a quick sale, but they still wish to comprehensively assess the market to arrive at the best possible price. Investment properties are also well suited to be sold at an auction.
What are the benefits of selling your house at auction?
Let us go back to the most notable advantages of auctioning your house. Well, for starters you will be totally assured of having a binding contract once the hammer falls. This completely does away with any importune disappointments should a buyer pull out of traditional private treaty negotiations. On the other hand, the completion of an auction property sale often results in a price that is well above what you would access in a private treaty sale.
There is also total transparency in the entire process, and all potential buyers can keep track of the proceedings. This definitely means that they will all have an equal opportunity of realizing the purchase. Finally, the reserve price (more on it later on in the article) is fixed in advance, and if it is not realized the auctioneer will withdraw your house from the auction.
How much does selling your property at auction cost?
You should be ready to pay your auctioneer at least 2.5% of the eventual price you get from the sale. You should also determine beforehand whether you will have to foot any advertising costs, which can drive up the expenses you will incur. Additionally, you will need to enlist the services of a solicitor to take care of the legal angle of the sale before the auction for your property takes place. Solicitor fees tend to vary from one to the next, and it can be prudent to check out several to obtain an ideal price as well as service.
How do you choose an auction house?
You should take your time to go through promotional material of the auction houses that operate in your area to identify the best for your needs and preferences. It is worth noting that established houses tend to be expensive. But often bring to the table a wealth of knowledge and skill in efficiently marketing your property to the maximum number of potential buyers that is possible. All in all, you should settle for an auction house that deals with properties similar to your own and also within the price range of yours.
Setting the reserve price
The reserve price happens to be the minimum amount that you will concede to. This price will always be kept confidential between you and the auctioneer. Should the offers made fall below this mark, the auctioneer will withdraw your house from the auction. However, this will not in any way prevent you from opening negotiations with any of the potential buyers once the auction is over.
What happens when you sell your house at auction?
You may be at this moment probably wondering out aloud, what happens when you sell your house at auction? Well, like earlier stated, property auctions are highly noted for their quick termination. Once the hammer falls, the buyer will immediately put down a 10% deposit. And the sale should be completed no later than 28 days after the auction date. This kind of property sale is considered to be legally binding, and should the buyer fail to complete the transaction, you are legally entitled to open legal proceedings against him or her. On the flipside, you will have to put yourself in readiness for a quick move once the sale is made. So it can be wise to arrange all the necessary plans prior to the auction date.