Is it considered reasonable to share some vendor auction costs with the buyer?

[Deleted User]

I'm selling a residential property via a national auction shortly and would like to ask if it's considered reasonable and fair to stipulate that the buyer of the property pay something towards the vendors (Myself) legal costs and/or auctioneers costs? I've not sold a house at auction before but have seen these type of stipulations before in the legal packs. Any advice would be very much appreciated - Thank you

Thrugelmir

Don't expect any takers. 

GDB2222

Lots of auction properties include such terms. It’s so common that I assume buyers expect it and knock however much it is off the price. 

Have a look at the legal packs for a few lots in a recent auction from the same auctioneers.

user1977

I think it's reasonably commonplace to add legal costs (or at least some of them) as a special condition.

[Deleted User]

GDB2222 said:

Lots of auction properties include such terms. It’s so common that I assume buyers expect it and knock however much it is off the price. 

Thanks for your reply GDB2222 - Have you an inkling as to how common this would be and does a request of 50% seem reasonable to you of legal fees and auction fees or perhaps just one or the other?

Have a look at the legal packs for a few lots in a recent auction from the same auctioneers.

I'll do exactly that

user1977 said:

I think it's reasonably commonplace to add legal costs (or at least some of them) as a special condition.

Thanks for your reply user1977 - So would you have a personal opinion as to what you'd feel is reasonable in terms of a percentage of my legal fees? My legal fees are just shy of £1,000 for the entire process excluding the local searches which are probably not more than £350

user1977

Deleted_User said:

user1977 said:

I think it's reasonably commonplace to add legal costs (or at least some of them) as a special condition.

Thanks for your reply user1977 - So would you have a personal opinion as to what you'd feel is reasonable in terms of a percentage of my legal fees? My legal fees are just shy of £1,000 for the entire process excluding the local searches which are probably not more than £350

I would have a look at other legal packs to see what other vendors are currently doing, some describe it as a "contribution" but I suspect it may be their entire legal fees - which I'd hope would have been less then £1000 given your solicitors aren't answering enquiries or negotiating anything. Certainly searches tend to be charged for.

Chris_English

I’m not sure what you hope to achieve by this. Any buyer is just going to factor these extra costs in and knock that much off how much they are willing to pay. It’s unlikely to give you anything more in your pocket and may even put off some buyers who are concerned at why it’s being added on.

london21

Very common.

Some charge more than others. 

[Deleted User]

user1977 said:

Deleted_User said:

user1977 said:

I think it's reasonably commonplace to add legal costs (or at least some of them) as a special condition.

Thanks for your reply user1977 - So would you have a personal opinion as to what you'd feel is reasonable in terms of a percentage of my legal fees? My legal fees are just shy of £1,000 for the entire process excluding the local searches which are probably not more than £350

I would have a look at other legal packs to see what other vendors are currently doing, some describe it as a "contribution" but I suspect it may be their entire legal fees - which I'd hope would have been less then £1000 given your solicitors aren't answering enquiries or negotiating anything. Certainly searches tend to be charged for.

Thanks for your very helpful reply. So I decided to include in the special conditions that the buyer is to pay for all my legal costs which as you say were around £1,000, the costs of the auction fees, the local searches and another low value expense. All together I think it's saved me over £6,000 and I did exactly as you mentioned by having a look at other auction legal packs and I saw that quite a few had similar conditions within the "special conditions of sale" so I thought I'd give it a go and the overall achieved sale price of the property was much higher than I'd hoped for as well so overall it was a very good decision which I was extremely pleased about! Perhaps it was a combination of just fortune and that there's a shortage of property on the market.

Chris_English said:

I’m not sure what you hope to achieve by this. Any buyer is just going to factor these extra costs in and knock that much off how much they are willing to pay. It’s unlikely to give you anything more in your pocket and may even put off some buyers who are concerned at why it’s being added on.

Some buyers might take that into consideration but some might not I don't believe anybody would "not" buy the property just because of additional fees as they'll simply adjust their top price to account for this and won't pay anything over. I decided to include all of my auction fees, solicitor fees and the costs of the searches as well as another small cost. I didn't see that there was a down side to doing this.

london21 said:

Very common.

Some charge more than others. 

Yes, I had a look through the legal packs and there were all sorts of variations for instance some wanted the buyer to pay all of the auction charges, all of the legal charges to include the search whilst others only wanted the legal fees paid for etc