Why Selling Through Auction Is Proving Popular With Current Vendors

When it comes to selling your home, the majority of people will automatically go down the route of “private treaty / open market”.  This has always been the “norm” in this country, and seems like it is the only way.  However, there is another option which brings greater security and more exposure for your property, and that is selling through the auction. 

Selling through auction isn’t just for run down properties despite what well known tv programmes would have you believe. In fact, more and more people are seeing the advantages of selling this way.

The first thing to get your head around is setting the price you want your house to sell for.  First and foremost, you can set a reserve, so it will never go for less than your bottom line.  There is then the guide price which is what the property is marketed at.  Ideally the guide price needs to be 10% under your reserve.  This is done to draw people in and encourage as many bids as possible.

The next step is deciding whether you want to go purely online.  If so, it will remain live for a set period of time and anyone who is interested can register their interest, and by the end you will hopefully have acquired numerous bids ensuring you get the price you want for your home.  The other option is to go down the more “traditional” route which is the auction room.  Currently these are all being done live via video link due to COVID-19 restrictions. 

As a seller you would only have to pay for the legal pack and solicitor fees, the buyer pays all the sales fees.  Finally, sales through the auction complete in a much shorter time period.  At the moment standard on market sales are taking over 20 weeks to complete, auction sales complete in half of the time (more info on that later in the article).  Between this and the fees, you will be saving both time and money in the long run.

If all the above sounds like an option that you would consider when selling your home, but you’re not 100% convinced then Martin at SDL Auctions has 3 genuinely great reasons for going down the auction route.

1)       Stamp Duty Holiday

With the stamp duty holiday coming to an end on 31^st March whereby completion must take place before then for the stamp duty exemption to apply, there is still a demand for buyers and sellers to make things happen.  In the world of auctions, that’s plenty of time.  But, if you’re buying or selling on the open market, beating the deadline is looking increasingly risky, especially with the current high demand for conveyancing services.  Conveyancers have already warned that they are “stretched to the limit” and some are turning down new work so they can ensure existing clients are not disappointed.

As a result, we expect to see an increase in both private sellers and estate agents taking advantage of the speed and certainty of auction to ensure completion takes place before the end of March.

Add to this the news that second home-owners could face a huge hike in capital gains tax bills under new proposals revealed this week, we could also see an influx of landlords beginning to sell off their stock via auction too.

The stamp duty deadline and the capital gains tax bombshell should all add up to a strong auctions market for the rest of 2020, but this is no time for complacency.

2)      Vaccine News

The first COVID-19 vaccine has been approved – and has being rolled out, this should herald a beginning of a slow return to normal life – or a “new normal” at least.

Many people will be breathing a sigh of relief, but within the property market I believe there could still be dark clouds on the horizon for 2021.  I think it will only be once the pandemic is over, that we will start to count the cost of the virus and its impact on both the property market and the wider economy.

3)      2021

Home - movers and investors should be prepared to face a tough 2021 – and consider selling now to ride the current wave of optimism while it lasts. This highlights the opportunities available under “auctions” and if you are looking to sell your home with vacant possession or “chain-free” then why not consider a different approach.

Understandably for many of our current vendors these were massively compelling reasons and exactly why they chose the auction route.  It is hard to ignore the mounting evidence as to why it is such a great option for so many people. 

If you would like more info on selling through the auction, then don’t hesitate to call Eric Clarke or SDL Auctions.

Till next time…