Auction pros/cons: 3 bedroom

[Deleted User]

NameUnavailable said:

A traditional auction would seem to be the best option for you - serious cash buyers (developers etc) buy at such auctions and when the hammer falls the property is sold and exchange takes place immediately.

Given the development potential I would think it would attract that kind of buyer - contact some auction co's and they will advise you. You set a reserve but they will want you to pitch it on the low side to get interest and hopefully a bidding war. You can also put 'special conditions' in the contract such as the buyer has to pay some or all of the auction fees.

Does the estate agent promote the auction if its the traditional type?  Or do I not use an EA in this case?  I don't mind paying a commission but I want the EA to get the word out.  Do they actually sell the place in an auction room like the TV show?  And will people be showing up unannounced at the property?  I ask because I'm only there on weekends normally.  

gwynlas

Paul Fosh is an auctioneers covering Wales who have an online prescence and are often on Homes Ubder The Hammer. Their June catologue is currently on line which shows they sell all types of property. Have you had  to apply for probate? What have local agents suggested regarding conventional sale which should get you the best price? They could arrange open days which would concentrate viewings and give a good indicationn of interest before it goes to auction the only advantage of which is the speed of transaction.

eddddy

[Deleted User] said:

Does the estate agent promote the auction if its the traditional type?  Or do I not use an EA in this case?  I don't mind paying a commission but I want the EA to get the word out.  Do they actually sell the place in an auction room like the TV show?  And will people be showing up unannounced at the property?  I ask because I'm only there on weekends normally.  

With a traditional auction - the target market will typically be investors and developers who will be cash buyers (who don't need a mortgage, and are not in a chain).

• The auction house will do the marketing. They'll have a mailing list of investors and developers, who they will contact. Plus they will list the property on Rightmove.

• Typically, potential 'owner/occupiers' don't buy at auction.

• The auctioneer will arrange a few block viewing dates... The auctioneer will turn up, unlock the front door, and stand back, while (hopefully) lots of prospective buyers turn up and wander around the property.

(Whichever way you market the property, you might get annoying people knocking on the door unannounced, but you're free to turn them away.)



But you can have a similar arrangement with a conventional estate agent - called an 'informal tender'.

• You put the property on the market for maybe 2 or 3 weeks
• The estate agent arranges block viewing dates
• People view and then submit their offers in writing
• At the end of the 2 or 3 weeks, you look at all the offers and decide which one you want to accept (if any).

That process might be more appropriate if you want to include prospective owner/occupiers - who might be in a chain and/or who might need a mortgage (if your property is mortgageable). And/or FTBs and others, who might be nervous of buying at auction.

propertyrental

I wouldn't even consider a property up for sale via MMA so however attractive the property, location etc you'd lose me as a potential buyer.

Stick it in a trad auction. Let the auction house advertise it. Sell and go sailing.

I take it your initial sentence was not accurate? "I inherited my parents 3 bed bungalow not too long ago". Did you and your brother inherit jointly?

FreeBear

[Deleted User] said:  I had an estate agent look at it and she said i should consider putting it through an auction website as it would be a quicker sale and as its non-traditional construction (Lilleshaw) it might sit a long time if sold through the estate agent in the normal way.

It would appear that Lilleshall precast reinforced concrete (PRC) houses are designated as defective under the Housing Defects Act 1984. If this is the case, and your property is a PRC construction, a traditional auction may well be the best way of selling.

Unless the property has been repaired and has a PRC repair certificate, a mortgage company is unlikely to lend. So this means cash buyers only. Selling on the open market is going to take a very long time, and using a MMoA will double/triple that wait.

Before you put the property on the market, you need to establish if the construction is listed as defective - If it is, I'm afraid you'll just have to accept a low price at (traditional) auction. If it isn't defective (or has a PRC certificate), happy days, you should get a better price at auction or even find a buyer on the open market.

[Deleted User]

gwynlas said:

Paul Fosh is an auctioneers covering Wales who have an online prescence and are often on Homes Ubder The Hammer. Their June catologue is currently on line which shows they sell all types of property. Have you had  to apply for probate? What have local agents suggested regarding conventional sale which should get you the best price? They could arrange open days which would concentrate viewings and give a good indicationn of interest before it goes to auction the only advantage of which is the speed of transaction.

Probate has been granted. I am the main executor, so it was suggested to leave the house deed alone until its sold, then xfer it to new owners. Im also named in the will as beneficiary, with my brother who is a reserve executor, if needed later on.  The EA says they struggle selling these for reasons of mortgages not going through, and that people are afraid of these concrete designs because they are not brick, etc.  The land is in well drained and in an elevated area so no flooding or standing water ever.   The EA says a guide is 150,000 and a value of 175k potential.  Which is pretty cheap for 2024, large lot, 3 bed detached.  Flats around here attached are 200k on a busy street.  But they are the standard 100 yr old builds.   

[Deleted User]

propertyrental said:

I wouldn't even consider a property up for sale via MMA so however attractive the property, location etc you'd lose me as a potential buyer.

Stick it in a trad auction. Let the auction house advertise it. Sell and go sailing.

I take it your initial sentence was not accurate? "I inherited my parents 3 bed bungalow not too long ago". Did you and your brother inherit jointly?

Yes, equal share on the will.  We are both listed as executor, but i did the probate with him as a reserve.  So the grant just lists me, and 1 reserve.  He is in the states and is letting me sort this mess out.   My other question is do i need an EA for a traditional auction to handle the viewings and promoting of the property?  In other words the marketing.

[Deleted User]

eddddy said:

[Deleted User] said:

Does the estate agent promote the auction if its the traditional type?  Or do I not use an EA in this case?  I don't mind paying a commission but I want the EA to get the word out.  Do they actually sell the place in an auction room like the TV show?  And will people be showing up unannounced at the property?  I ask because I'm only there on weekends normally.  

With a traditional auction - the target market will typically be investors and developers who will be cash buyers (who don't need a mortgage, and are not in a chain).

• The auction house will do the marketing. They'll have a mailing list of investors and developers, who they will contact. Plus they will list the property on Rightmove.

• Typically, potential 'owner/occupiers' don't buy at auction.

• The auctioneer will arrange a few block viewing dates... The auctioneer will turn up, unlock the front door, and stand back, while (hopefully) lots of prospective buyers turn up and wander around the property.

So, i could just avoid an estate agent in this case? Or would i need one to do any marketing?  I would like the maximum exposer if possible, but also i would rather not rack up any unnecessary fees if possible.  Im assuming the trad. auction the seller has to pay for the costs involved?   Will a cash buyer do surveys and the whole 9 yards? And the conveyance will be with a local solicitor?   You can tell this is my 1st time doing this.  

propertyrental

Auctioneer will market it. They want it to sell at auction as much as you or any EA. You don't need both.

eddddy

[Deleted User] said:

eddddy said:

[Deleted User] said:

Does the estate agent promote the auction if its the traditional type?  Or do I not use an EA in this case?  I don't mind paying a commission but I want the EA to get the word out.  Do they actually sell the place in an auction room like the TV show?  And will people be showing up unannounced at the property?  I ask because I'm only there on weekends normally.  

With a traditional auction - the target market will typically be investors and developers who will be cash buyers (who don't need a mortgage, and are not in a chain).

• The auction house will do the marketing. They'll have a mailing list of investors and developers, who they will contact. Plus they will list the property on Rightmove.

• Typically, potential 'owner/occupiers' don't buy at auction.

• The auctioneer will arrange a few block viewing dates... The auctioneer will turn up, unlock the front door, and stand back, while (hopefully) lots of prospective buyers turn up and wander around the property.

So, i could just avoid an estate agent in this case? Or would i need one to do any marketing?  I would like the maximum exposer if possible, but also i would rather not rack up any unnecessary fees if possible.  Im assuming the trad. auction the seller has to pay for the costs involved?   Will a cash buyer do surveys and the whole 9 yards? And the conveyance will be with a local solicitor?   You can tell this is my 1st time doing this.  

You don't use an estate agent. The auction house does the marketing. (You don't do any marketing.)

The end-to-end process usually takes a minimum of maybe 8 to 10 weeks. Or longer, if you have to wait for an auction date to come around.

The process is usually something like this:

• You choose your auctioneer, and enter your property into their next auction (maybe 4 weeks before the auction date). You agree a reserve price with the auctioneer.

• The auctioneer will probably visit the property, take photos, etc

• You instruct your solicitor to prepare an "Auction Legal Pack"

• The auctioneer publishes the catalogue (maybe 3 weeks before the auction date)

• So prospective buyers have 3 weeks to view properties - do any inspections / surveys they require, check the legal pack etc

• When the auction ends, the highest bidder is committed to buy the property, and you are committed to sell (assuming the reserve price is reached)

• 4 weeks later, the sale completes. You get the money, and you no longer own the property.

Is anyone living in the property? Obviously, they'd have to move out before the sale completes.