There are a range of sales options available for buying and selling property, not just Private Treaty. Auction has become more popular for buyers who want additional speed, security and transparency in their property purchase.
Our most popular auction method provides speed, security, and transparency. The fixed 56-day timescale means that you’ll have enough time to arrange finance so you can still buy with a mortgage.
Private treaty has a 30% Fall Through Rate. Modern Method of Auction (Secure Sales) only has a Fall Through Rate of 5%.
Complete in just 56 days from receipt of draft contracts.
Buyers pay a non-refundable reservation fee and sign an agreement showing their commitment to the purchase. This is a minimum of £6,600 including VAT or 4.5% of the Sold Price. Both the buyer and the vendor are tied into the sale, meaning you can be confident that the move will go ahead as planned.
The non-refundable Reservation Fee is paid when the auction ends and is paid in addition to the agreed purchase price. So you’ll have to consider the cost when setting your budget. And you’ll need to ensure that you can pay the Reservation Fee on the day of the auction.
In some cases, the seller may choose to pay the Auction Fee. In these cases, you will be asked for a Reservation Deposit to be paid on the day of the auction. This will then be deducted from the sale price on completion. Please refer to the property terms and conditions for details.
Your sale is secured with a pre-agreed Reserve Price, meaning you’ll not sell for less than that.
Transparent bidding promotes competition, helping you get the best possible price.
With fixed 56-day completion timescales, buyers have time to arrange finance, so, you’ll open your property up to mortgage and cash buyers.
You do not have to pay for the Reservation Fee. This is the additional fee above the purchase price, that is the responsibility of the Buyer. If you want, you can pay the Reservation Deposit. In these case, the buyer will be asked for a Reservation Deposit to be paid on the day of the auction. This will then be deducted from the sale price on completion. Please refer to the property terms and conditions for details.
All auction properties will need an Auction Pack.
They contain information a buyer needs to make an informed decision on your property before placing a bid. This includes:
You can provide the Auction Pack yourself, or use our specialist Auction Conveyancing Service. With auction, it is highly advisable to instruct your Solicitor upfront to ensure a smooth process. This is especially true of Traditional (Unconditional) Auctions, where you must instruct a Solicitor as soon as possible to ensure that you can meet the quicker 28-day completion timescales. You can choose our specialist Auction Conveyancing partner, or your own Solicitor.Using a third-party service for Auction Packs and Conveyancing.If you’re using a third party for your Auction pack, we’d need an electronic copy of the documents before we’re able to sell your property.If you’re selling through Traditional Auction terms, and you’re also using a third party for your Conveyancing, they’ll also need to supply a Draft Contract and their bank details when sending the pack to us. This will ensure that any exchange deposits are transferred to them as soon as possible at the end of a successful auction.
If the auction ends before the reserve is met, then your Auction Specialist will discuss how you move forward. You can accept the highest bid should you wish, but you are not bound to do so.
With the Modern Method of Auction, the bid binds the buyer to pay a non-refundable Reservation Fee.
It does not bind the buyer to buy the property it reserves the rights to exclusively exchange contracts on the property at an agreed price within 56-days of the draft contracts being received by the buyer’s Solicitors. And if they withdraw from the sale, they will lose their Reservation Fee.
This type of agreement is typical for properties marketed under auction terms. Sole Selling Rights means that the property can only be marketed and sold through Norman Galloway Sales & Lettings and iamsold whilst it is under contract, and this ensures all parties can proceed in the instance advised above.
If the property was marketed under different terms by different agents, then this is likely to damage your marketing. It may encourage buyers to avoid the terms and commitment that you have chosen as a seller for very specific reasons. It can also confuse your buyers!
Negotiations must be carried out by your Norman Galloway Sales & Lettings and iamsold whilst you are under contract and there are several reasons for this.
As the seller, if you accept an offer privately you will become liable for the auction fees rather than the buyer, this is due to the terms of the contract.
Our sale methods are designed to provide commitment and security to both parties, and you have likely chosen this method of sale for those specific reasons. Our aim is to help you sell your property, so, we will work with any interested party if they are unsure about auction, so that we can try and agree a sale for you.
A management pack provides important information regarding a leasehold property. The pack is obtained from the Freeholder or their Managing Agent.
The pack contains information on the management of the freehold, ground rent, service charges, buildings insurance and other relevant information to ensure the buyer is aware of their responsibilities should they proceed with the transaction. It will also contain information required by the buyer to transfer ownership.
In short, the auction duration is bespoke to the seller’s situation and the level of interest created whilst the property has been in the Pre-Auction Marketing stage (PAM). Properties can be live at auction from two days up to two weeks. We would highly recommend that you register your interest with us, and view the property before the auction. Our Auction Specialists will then keep you informed if there are any changes in circumstances. For example, if the vendor decides to end an auction or accept a bid before the end of an auction. If we are unaware of your interest in a property it is difficult to communicate any changes in circumstance.
Firstly, you will need to register with us and a link to do this can be found on the property detail pages of our website. Once you have completed the registration and have been approved, you will be sent an email confirming that you are registered to bid and able to place bids online. We would recommend that you have viewed any properties in question and looked through the legal information supplied within the Buyer Information Pack for each property, ideally with your Solicitor, before bidding at the auction.
Bids, or offers, can be placed at any stage during an auction process. Even if the property is in “Pre-Auction Marketing” status, you would need to consider that the Buyer Information Pack has not been signed off and may be incomplete. By law, we must put any offer that is made forward to the seller. It is then up to the seller to decide if they want to consider the offer and take the property out of the auction early. In this situation, the Reservation Fee is still payable, and the Terms and Conditions of the auction still apply.
The Reservation Fee will be included in your liability for stamp duty. Current HMRC policy is that the chargeable consideration (monies or monies worth) for a land or property transaction is what has been given (either directly or indirectly) to acquire the subject - matter of the transaction, by the purchaser or a person connected with them. This includes fees which have to be paid to acquire the property. This means that whatever you, the buyer, pay will form part of the purchase price for the property and will be included in your liability for stamp duty. In all circumstances, we would recommend discussing this with your chosen Solicitors before committing to a bid.
With the Modern Method of Auction, the bid obliges you to pay a non-refundable Reservation Fee and sign a Reservation Agreement. It does not bind you to buy the property it reserves the rights to exclusively exchange contracts on the property at an agreed price within 56 days1 of the draft contracts being received by your solicitors. If you withdraw from the sale, you will lose the Reservation Fee.
With the Traditional Method of Auction, once your bid has been accepted, or auction has been won, then you are required to exchange contracts and pay a 10% deposit alongside the Reservation Fee. Completion is generally expected within 28 days of exchange.
Usually, the seller chooses for the buyer to pay the Reservation Fee as a sign of commitment and agreement to the auction terms. As the vendor does not have to cover this cost, they are aware that the buyer is required to consider this on top of a purchase price. Most vendors have decided to use the auction method due to past experiences on the open market or are motivated by security and speed of sale over the potential price achieved.
Competitive Prices, with the fee taken into consideration: When looking to buy a property most people will look at a total purchase price with the fee included and all the properties available through our online auction are priced realistically to sell. Increased security: You’ll also get the added security of sale, both parties will sign a Reservation Agreement, meaning that both parties are bound by these terms. If the seller pulls out of the sale, they are liable for the Reservation Fee, reducing the risk of a sale not completing.
You’ll get the speed and transparency of auction: Buying through auction will also speed up the sale, allowing you to get moving, quicker. The additional information upfront and transparency in the bidding process will mean you know exactly what you’re bidding on and that you’re not overbidding.
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