Chris Williams, Solicitor in the Conveyancing department at Oliver & Co, has recently been featured twice in The Daily Telegraph’s article sharing insights on expediting the process of selling a property, with a particular focus on selling at auction. This highlights our team’s expertise and unwavering commitment to excellence.
Why buy/sell at auction?
There are many benefits to buying or selling at auction. Here are some reasons why more and more people are choosing to go down the auction route.
Buying at auction:
Certainty – With conventional house buying and selling methods, there are many things that could go wrong such as a potential buyer attempting to undermine your bid. When the auctioneer’s gavel strikes, contracts are exchanged, and there’s no turning back. So you won’t have to worry about a party pulling out. Once the hammer goes down, the property is sold within 28 days.
Finance – It is a common misconception that you cannot purchase at auction with a mortgage or loan. You can, even if the home is in need of some renovation work. However, it is crucial that mortgage/loan arrangements are made before the auction as the buyer will lose their 10% deposit if the transaction is not completed within the 28 days after the auction. You should take advice from a suitably qualified mortgage advisor if you require a loan to purchase a property.
Cost effective – In doing a comparison with similar properties in the area, you may find that properties at auction are cheaper than buying through an estate agent. Bear in mind that some of the properties may need work, but if you have the imagination and budget, you could add value to the home, if you choose to sell at a later date.
Information – Auctioneers make all the necessary legal and tenancy documentation available which is also known as the ‘legal pack’. The pack is usually easily accessible and downloadable from the auctioneer’s website. Familiarise yourself with the legal pack in advance and, most importantly ask your Solicitor to explain anything that you might be unsure of.
Selling at auction:
Speed – When you put your property on the market with an Estate Agent, there may be no deadlines. Your property could be up on the market for months or even years to no avail. It is a waiting game as soon as it goes on the market, with no certainty it will sell. Compare this to auctions, where auctioneers cover the market in a short period of time. Auction houses often carefully protect their success rate by taking on properties they know are very likely to sell. In general, this all comes down to being realistically priced. In short, it’s in their best interest to give you an honest, accurate valuation. They will tell you what price they’d be comfortable valuing the property at. As Chris Williams advised in the quote in the Daily Telegraph, “Auction sales generally complete 28 days after the highest bid has been accepted.” This provides certainty and a speedy conclusion to the sale.
Reserve price – Prior to listing your property for auction, you may be required to establish a reserve price, signifying the lowest amount you’re willing to accept. It’s vital to recognise that neither sellers nor auctioneers influence the eventual sale price, as it’s entirely determined by the highest bidder and becomes binding once the gavel falls. Hence, careful consideration in setting the reserve price before the auction is imperative. It is important to take note of the advice Chris Williams was quoted as giving in the Daily Telegraph, that “you should speak with the auctioneer about any fees which may be incurred if the property fails to sell for more than the reserve price.”
Transparent process – Auctions draw a diverse pool of prospective buyers. Investors and builders are frequent attendees at auctions, possessing a keen eye for untapped potential and the ability to address issues that might discourage other types of buyers.
Between exchange of contracts (when the hammer drops) and completion, there’s a series of essential steps to complete, all within a fixed timeframe. Your Solicitor’s ability to act swiftly and effectively becomes crucial during this period.
Want to know more?
We’re here to provide you with valuable guidance and support as you venture into this new opportunity. If you’re currently considering selling or buying a property at auction and require expert advice, please do not hesitate to get in touch with our friendly team on 01244 312306.
