Send house to auction - yes or no?

FingersCrossed_2

Hi all,

Long term MSE reader, quite new poster.

Bought a house with OH a year ago. He sold his old house no problem and mine has been on the market for a year! It did 'sell' but the day the keys were to exchange the guy pulled out. This was 6 months ago now and I have had almost no interest since.

I know my estate agents are good and the house has all been done up so is in great condition. The lack of interest just seems to be down to the market conditions etc etc. I had looked at renting it out but not worth it financially as would have to clear solicitor, estate agent and advertising bill. Would also be putting tenants in to a newly done up house which i'm not keen on.

House is on for fixed price £165,000. This would leave me a good wedge after clearing all debt. Problem is, I am forking out £1000 to keep the house sitting there and as all borrowings are interest free this is money down the pan... £1000 is pretty much my whole wage so OH is having to pay for everything in new house and all living costs. So we are very very skint!

So here is my dilemma. I enquired this week about sending the house to auction. The fees and set up all seem reasonable, but, I would have to put it on at a maximum guide price of around £130,000 to get interest. Auction company think it would fetch more than this but obviously no guarantee. I could set a reserve but apparently considered bad practice for reserve to be more than guide price. £130,000 would still clear all my borrowings and leave a few grand spare but is obviously a huge drop...

I am therefore looking to you guys for your fine advice and thoughts on this. Do I hold my nerve and keep ploughing £1000 a month in to keeping this house for potential profit in the future or do I stick it up for auction, hope it sells and accept I won't make the money I originally thought I would?

Worth noting, I live in Scotland.

Thanks

pawpurrs

Can you try lowering the price and asking for offers over instead of the fixed price senario. See if that works?

Presumbly as you are in scotland your buyer that pulled out had to pay you some money?

FingersCrossed_2

Hey,

It was on for a lower offers over price before but didn't make much difference. Estate agent says that lots of clients have lowered their prices recently and it hasn't helped so they advise against it. Think i'd have to drop it again eventually though.

Guy who pulled out of sale is legally obliged to pay for costs incurred over last 6 months (which will be thousands). Problem is he's done a runner and vanished. So to get the money i'd have to get a court order which solicitor advises would be costly and could take years to recover the money....

All very frustrating and lots of what if's..

Thanks

Gorgeous_George

Send house to auction - yes or no?

No.

Just send the details - leave the house where it is .

GG

p.s. More red wine please!

FingersCrossed_2

boom boom

Sounds like you've had enough - ha ha.

planemad

I have seen on a number of occasions local property that has been repossessed and went on the market with a local estate agent.
Sometimes the house does not sell for the asking price or maybe lower offers and the asset management company send it to auction where on many occasions I have seen the property sell for a good few thousand over the original estate agent asking price.

If you do want to try selling it at auction then set a reserve and give it a go.

Trollfever

Stolen from Merryn Somerset Webb, 29/01/08.

On the plus side you’ll have the interesting experience of finding out what it is really worth. An auction is the purest possible way of finding out the right price for something. There’s no PR, no careful marketing, no estate agent lies or manipulations, no ‘staging’ and no waiting for the ‘right buyer.’ There’s just a man with a hammer and a room full of potential bidders. And the price one of them eventually pays? That’s the market price – the right price for that house given the prevailing market conditions. I wonder if the Battersea penthouse would get £5m if it went to auction.

guppy

Might be "bad practice" to set reserve higher than the guide, but if you want a zero risk approach then insist on this if they will let you. Its your money at stake.

Assuming you can set a reserve, and the fees if it doesn't sell are reasonable, then there can't be anything to lose if you need to sell fast

misscharlie

I doubt the auction houses will take it on if they know it wont sell realistically. Take a look at whats going through the auctions and what price. I think you might be shocked. The best advice is to reduce. Its EA likes your the reason why they are not moving sod all. There are a 'few' buyers is the PRICE is right. You've already said your making a wedge on the house. If you dropped the house 12k at the start (just your mortgage costs) you could of sold without all the hastle of the last year.

Notlob

Consider renting it out!

dopester

misscharlie wrote: »

I doubt the auction houses will take it on if they know it wont sell realistically.

They might if they get paid something like £200 in fees for running it through - sale or no sale.

OP - approximately which area of Scotland please? Glasgow, Edinburgh, Aberdeen?