Probate property - to auction or not?

youth_leader

I can't understand modern auction at all, having to pay a non-refundable deposit to show interest and still having to bid against other people doesn't make sense to me.

I sold at 'traditional' auction and was very surprised both of the offers from buyers needed a mortgage.  The person I accepted didn't bid on the day,  I accepted his offer through the auction agent the day after the auction, and I had to wait over the weekend whilst he 'put it past his underwriters'.  I'd signed up for a one month unconditional auction, he also asked for two months, which I reluctantly agreed to.

eddddy

youth_leader said:

I can't understand modern auction at all, having to pay a non-refundable deposit to show interest and still having to bid against other people doesn't make sense to me.

Just to clarify - that's not typically how they work.  You only pay the non-refundable deposit (or reservation fee) if you win the bidding.

GDB2222

eddddy said:

youth_leader said:

I can't understand modern auction at all, having to pay a non-refundable deposit to show interest and still having to bid against other people doesn't make sense to me.

Just to clarify - that's not typically how they work.  You only pay the non-refundable deposit (or reservation fee) if you win the bidding.

But, you pay that deposit before survey and before knowing whether you can get a mortgage. It's a con.

GDB2222

We sold my aunt's house (in appalling condition) through estate agents, without any problems at all. I'm convinced the buyer overpaid/underestimated the cost of the work needed.

canaldumidi

Doshwaster said:

FreeBear said:

Pro of (traditional) auction - Quick sale.

Con of (traditional) auction - May not achieve top price.

Modern method of auction - Do not touch with a barge pole. It will put most potential buyers off.

Agent was really pushing the "modern auction" in terms of it being a quicker sale. more profitable for the estate agent   Said that private sales of houses in "distressed" conditions were more likely to fall through as buyers get cold feet after getting the surveyors report.

Irrespective of the valuation they gave you, or any other factors, I would cross that agent off your list (and tell them why). Agents will only stop pushing modern auctions if they see it is clearly losing them business.

Scotbot

As an executor you are legally bound to get the best price. That would normally be via the traditional EA route. If that didn't work you could then consider a traditional auction. As others have said forget the modern method.  The fees are eye wateringly high, often 4% as opposed to the traditional 1%. No wonder EAs like them. But buyers don't,  most will not even look at it and those who do will account for  the inflated fee and bid low.

NameUnavailable

DON'T consider 'modern method of auction' - you will simply waste time as nobody is going to buy it under those terms.

The benefit of a traditional or proper auction is a hassle free sale - when the hammer falls contracts are exchanged and it will complete within 4 weeks after.

Regarding the costs, you can stipulate within the conditions of sale that £X will be payable by the buyer towards fees (I sold a property via auction and made it a condition that the buyer paid an amount roughtly equal to half my costs).

It sounds like the house is ideal auction stock, the sort of place that could create a bidding war. Remember you also set the reserve price so you don't have to accept less than you think it should sell for.

Doshwaster

Had the result of the second valuation today. A bit more than the first one but in the same ballpark. Agent said a traditional auction was an option but didn't push a "modern auction" at all.

Third valuation next week after which I need to make a decision. I'm in no rush to sell on behalf of the of the beneficiaries of the will, I just want to make the process as hassle free and low cost as possible. 

getmore4less

do some research.

here is a link for 2bed terraced in SSTC for wide area NE.

look at the  forsale/SSTC data

There is plenty of demand 

0-50	168/232
0-60	272/443
0-70	400/657
0-80	522/873
0-90	621/1071
0-100	697/1203
0-max	962/1683

Home in with a narrower areas and take a closer look at your valuation price range to see if it looks realistic
Against what's for sale and SSTC then look at the sold through prices for the area.

GDB2222

Doshwaster said:

Had the result of the second valuation today. A bit more than the first one but in the same ballpark. Agent said a traditional auction was an option but didn't push a "modern auction" at all.

Third valuation next week after which I need to make a decision. I'm in no rush to sell on behalf of the of the beneficiaries of the will, I just want to make the process as hassle free and low cost as possible. 

You obviously want to maximise the sale price, which doesn't necessarily means having the highest asking price. It's often better to price fairly low so as to get plenty of interest.