Is it possible to avoid paying for Yopa Auction re. purchasing a house?

mistrihelen

We were buying a house via Yopa when our buyer fell through. The Yopa vendor put their house back on the market then a few days later turned it into as a Yopa auction which is advertising now and will run in a couple of weeks. When you read the small print, you have to pay almost 7k upfront as a buyer's premium that is non-refundable if you don't go ahead with the purchase.

We've just 'resold' our house and would like to get back into the chain - but we can't afford/don't want to do the auction. From our point of view, too much could go wrong if we do this. The auction is not binding like a normal auction. The seller is only selling for one specific house - if she loses that she will pull out. She also needs it all done in a specific timescale because her husband wants to retire asap. What if the survey brings up something crazy? The fee also adds to your stamp duty fee (is included as sale price).

It's not as if it's an auction bargain. They've put it on at basically its market value, and you have to add the 7k to your 'winning' bid. 

We want to go back to our chain the way it was - anyone know if this is possible once the vendor has agreed to make it a Yopa auction instead of a regular Yopa listing? Will Yopa make them adhere to it? We've messaged them to say we've sold again, yay, but no reply as yet...

AdrianC

Entirely up to their agreement with the agent.

If they can't or won't change it, then you have a choice - continue with the <spits> modern method auction, or walk away.

eddddy

You just go ahead and make your offer to the vendor - stating that it's a straightforward offer, not an auction bid, and you aren't prepared to pay any auction fees.

Then it's up to the seller whether they accept it. It's likely that the contract the seller signed with Yopa states that the seller would have to pay Yopa £7k if they sell to you - but that's the seller's fault for signing a contract like that.

Yopa (and the seller) are likely to put pressure on you to pay the £7k fee - maybe saying things like you have to reduce your offer by £7k and then pay the £7k fee.  But you should stand firm, and and make it very clear that you are refusing to pay any up-front fee (for the reasons that you mention).

mistrihelen

The vendor on this one is a bit bonkers sadly. Lovely but unrealistic (or perhaps it's me!). Still hasn't replied to our text, yet kept phoning my husband when it was the first round of offers.

This is a house that she bought for £279k or thereabouts in 2013. It's worth about £500k now in my estimate, and not just because I had that much to spend . She had it up for £580k because 'that's what I need to sell it for to get the house I want'. It was never going to sell at that price for a million reasons I won't go into detail about (wrong side of town, hardly any garden, small box rooms).  She came down to £520k for us when her vendor suddenly made a deal. We were prepared to pay over the odds because of our specific needs.

When our buyer pulled out, she left it on Rightmove as £580k! Waited a few days, then turned it into a £490k auction! Complete madness. Families like my own aren't going to want to risk paying a premium they never get back. But if she had reduced it to £550 or £520, she definitely would've got viewers.

We can only really afford to buy because of the SD holiday - which yes I realise is running out. My point is, if I had a spare 7k, I need to keep it for when the SD holiday runs out, not for a buyer's premium! We have also taken a cut on our new offer, so can't afford £520k any more. But the sad thing is it only took us 10 days to sell again and now we might not be able to reach a deal.

Have a feeling I'll need to wait out the auction and hope it doesn't get bids...

mistrihelen

Just wanted to update as there isn't much out there on Yopa Auctions when you google.
We spoke to our vendor first, who was a bit snippy but suggested we just make an offer through the dashboard as before (when we were in the chain previously we had only dealt with them in person, not with Yopa at all).

We rang Yopa for advice. One person said that as the auction hadn't started yet, we could make a 'normal' offer. However later someone senior rang back and said that while you could make offers, it would count as an 'auction buy it now' and the 7k fee would still be due. We asked if it was possible to offer normally when the auction ended - he said a new one would just begin, over and over for eternity.

We explained that we had no intention of risking our money on a non-refundable 'buyers premium' by taking part in the auction - the Yopa guy was very firm but eventually said that if the seller pulled out they'd be liable for the fee and not us. I said 'what about if our buyer pulls out - in this economy it's quite common' and he said 'maybe I can add a caveat in this case that you wouldn't have to pay'.

We still didn't want to go through with it but said we'd think on it. In the meantime he rang the vendor - who we had mistakenly assumed would want us to get back in the chain asap! He rang back later and said our vendor was actually hoping for more money in the auction than our original offer, so there was no point putting in an offer that was lower (to take account of the 7k fee). 

So now we have no house to buy. Sigh.

The vendor is unlikely to sell theirs (it's a family four-bed house with practically no garden, at a £490 start price when it's worth about £500 and they want £525 minimum).

Idiots! (Us or them, you decide)

Lespaul1960

Just wanted to update as there isn't much out there on Yopa Auctions when you google.
We spoke to our vendor first, who was a bit snippy but suggested we just make an offer through the dashboard as before (when we were in the chain previously we had only dealt with them in person, not with Yopa at all).

We rang Yopa for advice. One person said that as the auction hadn't started yet, we could make a 'normal' offer. However later someone senior rang back and said that while you could make offers, it would count as an 'auction buy it now' and the 7k fee would still be due. We asked if it was possible to offer normally when the auction ended - he said a new one would just begin, over and over for eternity.

We explained that we had no intention of risking our money on a non-refundable 'buyers premium' by taking part in the auction - the Yopa guy was very firm but eventually said that if the seller pulled out they'd be liable for the fee and not us. I said 'what about if our buyer pulls out - in this economy it's quite common' and he said 'maybe I can add a caveat in this case that you wouldn't have to pay'.

We still didn't want to go through with it but said we'd think on it. In the meantime he rang the vendor - who we had mistakenly assumed would want us to get back in the chain asap! He rang back later and said our vendor was actually hoping for more money in the auction than our original offer, so there was no point putting in an offer that was lower (to take account of the 7k fee). 

So now we have no house to buy. Sigh.

The vendor is unlikely to sell theirs (it's a family four-bed house with practically no garden, at a £490 start price when it's worth about £500 and they want £525 minimum).

Idiots! (Us or them, you decide)

Them!!  No doubt about it.  Modern method of auction benefits no one but the agent..

eddddy

mistrihelen said:

Just wanted to update as there isn't much out there on Yopa Auctions when you google.
We spoke to our vendor first, who was a bit snippy but suggested we just make an offer through the dashboard as before (when we were in the chain previously we had only dealt with them in person, not with Yopa at all).

We rang Yopa for advice. One person said that as the auction hadn't started yet, we could make a 'normal' offer. However later someone senior rang back and said that while you could make offers, it would count as an 'auction buy it now' and the 7k fee would still be due. We asked if it was possible to offer normally when the auction ended - he said a new one would just begin, over and over for eternity.

We explained that we had no intention of risking our money on a non-refundable 'buyers premium' by taking part in the auction - the Yopa guy was very firm but eventually said that if the seller pulled out they'd be liable for the fee and not us. I said 'what about if our buyer pulls out - in this economy it's quite common' and he said 'maybe I can add a caveat in this case that you wouldn't have to pay'.

We still didn't want to go through with it but said we'd think on it. In the meantime he rang the vendor - who we had mistakenly assumed would want us to get back in the chain asap! He rang back later and said our vendor was actually hoping for more money in the auction than our original offer, so there was no point putting in an offer that was lower (to take account of the 7k fee). 

So now we have no house to buy. Sigh.

The vendor is unlikely to sell theirs (it's a family four-bed house with practically no garden, at a £490 start price when it's worth about £500 and they want £525 minimum).

Idiots! (Us or them, you decide)

Obviously, there're trying to get you to make an offer on their terms (because they'd like to get £7k of your money in their pocket)

But as I explained above, you are completely free to make an offer on your terms - you don't have to ask their permission first.

A good way of making your offer might be by email to YOPA, stating that you are not prepared to pay any up-front fees. It might be best to avoid using an online form, as that probably has terms & conditions attached to it.

(If you want to get stroppy, you can remind them that the law requires them to pass all offers on to the seller  [unless the seller has signed a waiver])

But even then, the auctioneer might pass on your offer, but 'bully' the seller into not accepting it, in the same way that the auctioneer is trying to 'bully' you into making an offer on their terms.

Scotbot

Standard practice is for EAs to market property and auction houses to run the auction so I doubt the auction is being done by YOPA they are just marketing it (and the vendor has already paid them.) The auction will be done by an auction house, iamsold do a lot of modern method auctions.

Check the paper work. If it is with an auction house you will probably find them more helpful rd what you would be liable for. There will be a detailed legal pack.

mistrihelen

Scotbot said:

Standard practice is for EAs to market property and auction houses to run the auction so I doubt the auction is being done by YOPA they are just marketing it (and the vendor has already paid them.) The auction will be done by an auction house, iamsold do a lot of modern method auctions.

Check the paper work. If it is with an auction house you will probably find them more helpful rd what you would be liable for. There will be a detailed legal pack.

It's Goto running the auction - sorry I should've clarified. It was one of them who actually rang us.

mistrihelen

eddddy said:

But as I explained above, you are completely free to make an offer on your terms - you don't have to ask their permission first.

A good way of making your offer might be by email to YOPA, stating that you are not prepared to pay any up-front fees. It might be best to avoid using an online form, as that probably has terms & conditions attached to it.

(If you want to get stroppy, you can remind them that the law requires them to pass all offers on to the seller  [unless the seller has signed a waiver])

But even then, the auctioneer might pass on your offer, but 'bully' the seller into not accepting it, in the same way that the auctioneer is trying to 'bully' you into making an offer on their terms.

Thanks for this - apologies for the stupid questions that are going to follow now! I was under the impression they'd be locked into the auction and unable to get out. That's what Yopa/Goto have told us. The Goto man said even when the auction ends it will just roll into another one. Are you saying Yopa are still bound as an EA to pass on offers and they can still choose to accept them prior to the auction? Edited to add: actually I just read your earlier message and  you say they might have to pay the fee in that case. I think the chances of that are very slim, but I suppose  you never know.

I've just messaged the vendor slightly passive aggressively (through the Yopa dashboard) to say we won't be taking part in an auction, but feel free to reach out to us after if they don't find a seller, but lots of luck etc. They're a bigger problem than Yopa to be honest! A shame houses are so hot in my local market at the moment. I don't have any other options!

youth_leader

As the vendor has entered the auction whoever buys it is now is likely to have to pay the one off non refundable £7K, which is shared between the EA and auction house.  I sold through Pattinson's auction house and was told my contract with them was for three months - but it was a traditional auction, not the modern method where you pay the one off non refundable fee.