Selling - Open market or modern method of auction(MMoA)

hazyjo

Search this forum for Modern Method of Auction and you'll see exactly what people think of it.

Avoid like the plague!! You'll lose an enormous % of buyers.

eddddy

diystarter7 said:

Hi
Main reason IMO EA is "pushing hard" is they are guaranteed a much quicker completion and yes, you have guessed it, their fee.

Are there any costs if it does not meet your realistic reserve?

Thanks

p00hsticks said:

Op is talking about the 'Modern Method of Auction', not a traditional auction. So your comments about a much quicker completion and a reserve don't apply here as they would for the latter method.

Seems like there's a bit of confusion here.

The auctioneer's £6k+ fee must be paid by the buyer immediately after the auction finishes. So the auctioneer / EA gets their money quickly.

But the seller might have to wait another 8 weeks or more after the auction for the sale to complete.

And the 'Modern Method of Auction' has reserves - just like a traditional auction.


(Last time I looked at the t&cs of a large MMoA auction operator - the seller didn't have to pay anything if the property didn't reach reserve. But the sting is that the auctioneer's sole selling rights still continue after the auction, and last a minimum of 8 weeks in total.)

FarmGirl78

Yep, snap. I would completely disregard any house listed as MMOA. Doesn't matter how perfect it was, how much it was on for, I wouldn't touch it with a bargepole.

Murphybear

I would suggest going with a local estate agent.  Detached bungalows are very popular in many parts of the country, in our market town they sell very quickly, we have a lot of retired people here.

rancid-a

My local EA also recommended MMoA if a relative changes his mind about buying my property (I think he will).
She said it was free, but the info pack she sent me suggests I would need an 'Auction Pack' which seemed to cost about £1k and also a conveyancer. I'm wondering how she would benefit? Anyway, posters on here have advised against the auction, so I'm not going to go that route.

eddddy

rancid-a said:

My local EA also recommended MMoA if a relative changes his mind about buying my property (I think he will).
She said it was free, but the info pack she sent me suggests I would need an 'Auction Pack' which seemed to cost about £1k and also a conveyancer. I'm wondering how she would benefit? Anyway, posters on here have advised against the auction, so I'm not going to go that route.

It's free to the seller.

The problem is that the prospective buyer has to pay a large non-refundable 'reservation fee' to the auctioneer. It's usually a miniumum of £6k, but it could be a lot more.

That (and other terms in the buyer's contract) tends to scare many buyers away from bidding.

Estate Agents like the deal, because they get a cut of the £6k+ that goes to the auctioneer.


The £1k sounds steep for an auction pack - I assume that includes the cost of the searches.  But perhaps that's not really a major issue. Sellers often require buyers to refund the cost of searches (or sometimes all the seller's legal costs).

And, apart from the searches, it's all work that the solicitor would do for any type of sale - not just for an auction sale.

NameUnavailable

Should be called Crazy Method Of Auction. How to ensure the slimmest chances of getting a buyer!

loubel

As others have said, selling this way will massively limit the pool of potential buyers available to you. I wouldn't even look at the particulars of a property being sold this way. 

pinkshoes

Worried_of_wakefield said:

Have researched on the internet so I understand the mechanics, but would like to hear from people who have experienced the MMoA.

Inherited property, detached bungalow, circa £300K aged mother in-laws house so quite 'tired' needing work at some stage.

My worry is the estate agents are pushing hard on MMoA, which they would as thier rewards are greater

Either use a normal auction and set a reserve if you feel it might go for less than you wanted, or just put it priced to sell with an estate agent. You might even end up with a bidding war through either method if it is priced attractively.

I wouldn't even consider any property being sold through MMoA. Ridiculous scam.

Thejedimaster

I have signed up with an online house auction site with the modern method of auction. I’m looking into pulling out and not paying the £600 fee or be liable for the other costs. They have not done any work as they used the photos of the house from the advert of a well known online EA they are in alliance with. Anyone know if I have the right to cancel & don’t pay the fee please.