Selling property at auction is the easiest and quickest way of selling property compared to the open market. It also can be the ideal way of ensuring that you gain the best possible price and avoid any last minute hitches. With property auctions becoming more and more popular, the increase in demand for auction properties can often lead to the price being driven up.
Once the hammer falls the contract becomes legal and binding. The purchaser has to pay a ten percent deposit there and then, and come up with the balance within twenty eight days. This avoids the uncertainty that is usually associated with selling a property in the conventional manner, and the chance of parties reneging on their contract.
REASONS FOR SELLING PROPERTY AT AUCTION
Properties are sold at auction for a number of reasons:
- The vendor may require a quick sale.
- Bankruptcy or to clear debts
- The property may have been repossessed.
- The property may require significant redevelopment or refurbishment.
- The property may have proved difficult to sell on the open market.
One of the main advantages of selling property at auction is the speed at which the transaction can be progressed. The whole process takes about 8 weeks and there are no chains. Exchange of contracts takes place when the ‘hammer falls’ and completion is usually no more than 4 weeks later.
If it is your first time to sell at auction it is advisable to attend one or more auction to familiarise yourself with the process, take market survey of similar property and how they were sold.
STAGES OF SELLING PROPERTY AT AUCTION
(1). Choose an auction house/ auctioneer:
We can assist you in choosing an auction house that will be able to market your property effectively or you can surf the net/websites, newspapers, attend auctions etc. You should however put into consideration the commission and conditions for service of the auction house/auctioneer before engaging them. Formally appoint them to auction your property and enter a legal agreement with them.
(2). Choose a property solicitor:
It is vital when selling at an auction that you have the back-up of an experienced property auction solicitor with genuine experience of these types of transaction. Typically your solicitor will conduct searches, prepare the legal pack and set out any special conditions of sale, the legal pack will also contain everything required to facilitate an exchange of contracts on auction day such as Energy performance certificate, copies of relevant documents and legal papers, the title deeds, leases and searches. This will usually be made available to the auctioneers for potential bidders to examine, attend the auction, act on your behalf in the auction room, signing the Memorandum of Sale, manage things in the auction room, including the bidding increments, sell the property at the reserve price or above and oversee the exchange of contacts after the hammer falls. We have a lot of experience at assisting with auction sales and would be pleased to offer you a quote for our service.
(3). Deciding a price:
The next step is to decide a guide price for the property you wish to sell. This represents the lowest price you will accept for the property prior to the auction, or a range within which a sale price at the auction may be achieved. The guide price is agreed between you and the auctioneer. A few days before the auction, the auctioneer will contact you again to agree on a reserve price. This is a confidential figure agreed between the auctioneer and the seller below which the auctioneer cannot sell the property.
At the fall of the hammer, sale is concluded, contracts are exchanged and ownership passes to the highest bidder upon payment of 10 percent of the sum. The balance amount will be paid within 28days of the auction. We can assist in collecting the balance from the buyer and pay it into your account.
Please call us on 0207 183 0084 or email us on email@example.com for further insight into our services, advise on auctioning of property and to ask us about any reservations or queries that you may have; we are always happy to assist.
Ola Leslie Solicitors
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