“Is this your final offer? Any more bids? Going once. Going twice.” The gavel comes down. “Sold to the lady in the red coat.” It’s a familiar sounding end to a packed auction.
This time it wasn’t a valuable antique but a home that went under the hammer. Auctioning off your house can have its advantages. If you’re considering selling in this way then read on for the lowdown on how to auction a house.
Understanding How to Auction a House
You can set an agreed reserve price to the property before the auction. This is going to ensure you get what you need from the sale. This price isn’t disclosed to potential buyers.
This acts as an insurance policy for you so that you know you won’t have to take less than the price you’re looking for. If, in the end, you decide to accept a bid that’s lower than the reserve price, then that can usually be made possible.
There are lots of houses that make far more than the reserve price. These can exceed the price that could have been achieved through a conventional residential sale.
Auctions attract people who are interested in the items that are for sale. That includes houses. There are plenty of investors out there but there are also lots of others who are looking for a home to live in and perhaps renovate.
Any sale will be legally binding. This adds a level of security to both parties which is sometimes missing from a regular private sale. Any required checks would, therefore, need to be done before the auction took place.
Deposits are normally non-refundable making it more likely that the actual sale is not going to fall through.
It Can Become Competitive
When there’s a bit of competition involved in the bid, then the price that’s reached can end up much higher than was initially thought. Bidding wars between two or more parties can be fuelled by strong emotions between the buyers.
The whole process may only have lasted minutes but could bring you a result that was far better than you had expected. There can be showmanship on the day with auctioneers adding a bit of drama to the proceedings.
People can sometimes get caught up in the moment and pay more than they might have done in a private sale. This is especially true then there’s a competitive market and shortages of particular types of properties.
A Fast Sale
The whole selling and buying auction process could take up to eight weeks, sometimes a bit less. That’s far quicker than anything that could be achieved in a traditional sale.
Auctions tend to be exciting and fast-moving. Once the gavel goes down a completion date will be set. If you need a fast sale, then an auction could be far less time consuming and a more efficient way to offload your property.
A Clear Process
Conventional sales can sometimes get held up with caution and secrecy. Although there are things a home seller has to disclose, sometimes both sides may wish to withhold certain information.
The same is not true of auctions which are usually open to the public. The fact that everyone can see what’s going on at any given moment has made them successful.
Because of the very nature of an auction, potential buyers need to have their finances in order and be ready to complete a sale fast.
Lots of auctioneers know their local areas very well but they can also operate far further afield. This can lead to greater exposure for your house. That’s going to mean your chances of selling the property are higher.
The more potential interest there is in the property then the more chance there is of competitive bidding. This could well lead to a higher final price being achieved.
The Sale Date Will Be Set
If you’re wanting or needing to sell your property quickly then a private sale may not be the fastest way to do it. Keeping your property longer than you’d like to can be expensive.
Selling a house at auction means that you’re going to know the precise date it’s going to be sold. That will allow you to budget more effectively. Such certainty can be a real money-saver.
There’s an extra benefit too in that there will be no chain involved in the process. These can hold up the sale of any property no matter how attractive the selling price that’s going to be achieved.
Getting the House Ready
Any reputable auctioneer should put an effort into marketing your property. It should be attractive to a broad cross-section of potential buyers. That shouldn’t stop you though from doing some work on this too.
Your property should be looking its best for viewings by prospective buyers. There are lots of things you can do from increasing the curb appeal to making sure the property is clean and tidy.
There’s nothing to stop you doing some of your own direct marketing as well via social media or through family, friends and work colleagues.
Give Your Property an Immediate Value
Knowing what price to set your property at can be one of the biggest challenges of all. How can you be sure what a potential buyer may be prepared to pay?
At an auction, things are a bit different because the bids on your property are going to give you the answer. If bidders don’t go for anything close to the reserve price then you’ll know you may have priced the property a little high.
Auctions are Secure and Fast
If you need to sell your property quickly and at a certain price, then you need to understand how to auction a house. It can be a very attractive option that doesn’t involve a chain and lets you set the value of your home.
If you’re thinking of selling your home, read here for the steps you need to take to ensure it’s good to go.