Why auction a house? 5 reasons to put your house under the hammer
Reason #1: Quick sale
One of the benefits of selling a house in this way is that you could have it off your hands within a few weeks of the auction. Unlike on the open market, completion dates are usually set in stone, and if the buyer is unable to arrange the purchase in time, they can face some eye-watering penalties.
So if a house is not working for you, and you are looking to quickly ditch it from your investment portfolio, the auction route is definitely worth considering.
Reason #2: Attract knowledgeable buyers
You may be convinced that your property could be a bargain in the right hands, but what if local agents are unconvinced? If they don’t believe in your property, they are unlikely to convince viewers to put in a decent offer.
The one place you can be assured of attracting investors with an eye for a good deal is at an auction. Whether they’re looking for a no frills unit that they can quickly do up and let out, or a basic property they can flip for capital growth, experienced investors will regularly scour auction catalogues for properties at discount.
In the best case scenario, you could ignite a bidding war and sell your house for a lot more than you were expecting.
Interesting fact: The average guide price for an auction property in 2022 was £190k with London, the South East and the Midlands the most popular regions for buying at auction.
Why auction a house? Three more reasons
Speed of sale and getting a fair price are not the only reasons to auction a house. Here are three more:
- Transparency: With bids made publicly and the final sale price determined by the highest bidder, selling via an auction house can be appealing to those who value fair and open transactions.
- Simplicity: Buyers at auction must prove that they can finance a purchase and there is no chain involved in the sale. With less moving parts, auctions are simpler and more certain than traditional property transactions.
- Selling unique houses. Unusual properties can be difficult to sell through traditional means. Auctions attract a diverse range of developers and investors who are less likely to be put off by a quirky property.
Is auctioning a house the right move for you?
It’s important to stress that we are not suggesting that selling a house at auction is always the best way forward, even if your situation matches one or both of the scenarios above.
It takes experience to navigate a property auction, and green investors can get their fingers burned if they go in unprepared. Anyone looking to sell must go in with their eyes open. For example, they should factor in commission fees and other costs when working out their financials. They must also decide what to do if a buyer doesn’t meet their reserve price. If they smell desperation, experienced investors may put pressure on them to sell at a much lower price than they had intended.
To maximise your chances of getting a good deal when selling at auction, we recommend you come along to one of our free property investment seminars. For 90 minutes of your time, you could pose the question, ‘Why auction a house?’ to real investors who have both bought and sold at them. You will be more likely to get a rounded answer with all the pros and cons of choosing the auction route.
Check out our list of current seminar dates and venues and either book your spot today or add yourself to our alert list to be kept in the loop as we add more events.
