Is auctioning a house a good idea? If you can’t decide between an auction or a private sale, you’ll need to know how much it costs to auction a house, along with the advantages and disadvantages of auction sales.
Before we go through the auction pros and cons, we’ll take a look at the cost of selling at auction, including the auction fees for selling property.
Why auction a house and how much do auctioneers charge to sell a house?
One of the disadvantages of selling property at auction is the auctioneer commission percentage charged to the seller.
The auctioneer commission percentage will be between 2% and 3% of the final sale price, excluding VAT – which puts many people off sale by auction.
When it comes to the auctioneer fees, what is fair isn’t really taken into account.
At Property Saviour, we don’t agree with this, we think you should get a fair deal. That’s why we don’t charge any extra fees and we promise to beat all genuine cash offers. Find out more, here.
Selling at auction vs private sale
When considering ‘is auctioning a house is a good idea’, you may have already researched how to sell your house privately, being left with uncertainty of whether you should choose to sell via auction or private sale.
If you want a quick sale, you’ll know this is unlikely if you opt to sell your house privately, as it can take months to reach a completion date.
However, the risks of selling at auction are high and you may need some expert advice before going ahead.
Many people are interested in e-auctions, however, before agreeing we think you should know the pros and cons of online auctions – as they can be a big gamble.
What are e-auctions and how to auction a house online?
Online auctions are changing the way it works – so be mindful of this.
In an e-auction, bidders are able to participate from anywhere and at any given time. Auctioneers are not needed to run the auction.
When considering how to auction a house online all the information on your property is kept in the catalogue on the website for bidders to view at all times.
Regardless of this, however, the online auction does not take place face to face which means you can’t actually see who’s bidding for your property.
The auctioneers cannot have a hold on who is participating in the bidding. This can lead to anonymity in identifying the bidders.
As with Ebay, many bidders don’t go ahead with a purchase once they’ve won a bid. There is no guarantee, and it’s more difficult to gage the circumstances as you can’t see the buyer in person.
A lot of people choose online auctions as they think it will save them time. Sellers do not need to set up a live event or attend an auction house on the day of the bidding. However, it’s vital to remember an e-auction normally lasts much longer than a traditional auction, running over the course of a few days.
Also, even though detailed explanations and images are placed on the bidding website, a lot of communication with the seller is still needed to make an informed decision to buy the lot.
If you’re in need of speed, this probably won’t be the best option.
Other disadvantages of selling property at auction
Although there can be advantages of auctions, we think it’s important to explore the potential risks of selling property at auction first.
So if you’re still unsure if it’s a good idea to auction your house, have a think about the following factors.
Is auctioning a house a good idea? Well, there’s no guaranteed sale
Although you’ll have a fixed date for when your property will go to auction, there’s no guarantee you’ll find a buyer on that date.
If the auction house hasn’t advertised your property to a high standard, or your reserve price is set too high, your property is unlikely to be sold – even if there are interested bidders on the day. Imagine this happened after paying the auction costs?
When exploring how to auction a house, the point during the auction at which your property is available to bid on can also affect whether it will sell.
Often, properties at the very end of house auctions are less popular as only a few potential buyers will stick around until the end.
So, is auctioning a house a good idea? Potentially not, but let’s discuss in more detail.
Uncertain Sales Price
At a house auction, while you can set the minimum price that you will accept as your reserve at an auction, you can never be sure it will sell for more – or that it will even be met.
That can make it tough, especially if you are selling the property to fund your next purchase, as you won’t know how much budget you have available until the auction has finished.
That means if you are selling your main residence, you’ll need to be prepared to move into alternative accommodation after the house auction.
By doing this, you’ll be allowing time to get your finances in order before you buy a new home.
How can we help?
After reading our answer to the question ‘is auctioning a house a good idea?’ you’re probably thinking it’s not the most reliable option – and you’d be 100% correct.
On the other hand, here at Property Saviour we are reliable, and we’ll buy your house for cash, completing the sale within 5-10 days.
There won’t be any uncertainty like there is with an auction sale, and we promise to beat any other genuine cash offers.
Alongside this, we offer free valuation and will pay £500 towards your legal fees.
We even offer a free Energy Performance Certificate worth at least £50., along with free house clearance. This is definitely something to consider when asking ‘is auctioning a house a good idea?’
It costs nothing to give us a call and have a chat with our experts about your options, so get in touch, here or call us on 0113 320 6700.