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Benefits of choosing an auction to sell your house

Selling a property at auction is becoming more popular, as homeowners are increasingly attracted to the speed, simplicity and security of selling in this way.

In fact, last year nearly 40 per cent more property by value was sold at auction, as reported by unbiased.

If you're looking for a speedy sale and certainty that a buyer won't bail on you, then auctions are a good way to go. As long as there is enough interest and you've set a realistic price, your property should be sold by the end of the day.

If selling your house at auction sounds tempting, keep reading to find out the benefits…

Speed

One of the main benefits to selling your house at auction is the speed.

Once a property is sold at auction, a completion date will usually be set for just 28 -56 days later – a much quicker process than the 12 to 20 weeks or so that traditional sales can take. When you consider this speedy timescale, it’s no wonder more people are selling by auction.

This timeliness is due to the fact sellers will have the funds showing in their bank account quicker than they would when selling in a traditional way.

Security – methods of auction

A property sale at auction is legally-binding for both parties, with an immediate exchange of contracts and fixed completion date which offers added security for the seller when compared to traditional methods of sale. There are two methods of Auction that Browns can offer:

Traditional method of auction

This is a tried and tested method, associated mainly with selling and buying investment stock due to more restrictive timeframes to exchange contracts and complete the sale. A property sale at auction is legally-binding for both parties, with an immediate exchange of contracts and fixed completion date which offers added security for the seller when compared to traditional methods of sale. However, this method can limit buyers and the interest and activity around residential properties.

The modern method of auction

This more accessible route creates a transparent platform for buyers and sellers, combining the best aspects of traditional auction and private treaty sales.

This can offer more realistic yet fixed timescales, opening up the marketplace for buyers and sellers looking to arrange mortgages as their method of payment. The exchange of contracts has 56 days to take place from the solicitor’s receipt of draft contracts, whereas with traditional auctions, the exchange of contracts will usually take place as soon as the buyer has won the bid.

It also opens up the auction market (once reserved for the professional investor or cash-ready buyer) to residential buyers, creating a larger marketplace and more interest and activity than traditional auction. It is the preferred route for buying and selling via auction and has changed the perception of auction in the last decade.

Higher prices

Properties for sale at auction will often achieve a final sale price in excess of the original guide price set, and the result is in the region of what might have been acceptable for sale through an estate agent.

High prices are common for properties sold at auction, with most often exceeding those achieved through traditional sales methods.

If your reserve price isn’t met, you won’t be forced to take a lower price for your property – the auctioneer will withdraw it from the auction and you can re-list it at a later date, if you wish.

Bidding wars

If you’re lucky enough to have more than one person wanting your property at auction, this will lead them to bid against each other, and will help your property to achieve the best price.

If someone loses out on a bidding war, any money already invested into researching and carrying out surveys on the property may be lost, so bear this in mind.

Open sale

Property auctions are popular with vendors as an open and transparent method of sale is preferred.

With it being in a public room, people can see who and what is being bid.

Chain-free selling

One of the biggest disadvantages of selling a property through the traditional routes is the chain.

A chain is a sequence of linked house purchases, each of which is dependent on the preceding and succeeding purchase.

Selling a property at an auction avoids chains as people can only buy if they have the funds available and are chain-free. This gives you much more security that once a sale is agreed, it will actually happen and isn’t likely to fall through due to measures beyond your control.

Interested in selling your property via auction? Find out more and get in touch with our team here.

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