The auctions process – step by step

Posted by Blog Post on August 31st, 2021

If only the process was as simple as ‘sell house at auction’. Instead, the process involves seven main steps, beginning with an auction appraisal right down to completion of the sale.

If you’re considering selling your home at an auction, it’s important to consider all the steps and be as informed as possible, ensuring the sale goes smoothly.

Auction appraisal

Once you’ve decided to sell your home via auction, you should decide which auction you’ll choose to sell your home at. It’s a good idea to research auctions that specifically specialize in your kind of property, or sell them regularly – this way, you’ll know your property will be seen by the correct kind of buyers.

Then, you’ll need to have it appraised. Appraisals are usually completed by the auction you’ve chosen, and it involves an approved auction valuer assessing your property. They’ll outline the benefits of selling your house at auction, how much you can expect it to sell for, and advise on your reserve price.

At this point, there should be no obligation to go through with the auction, so it’s best to use this opportunity to gain any advice and ask questions around the process.

Instruction

If you decide to go ahead, you will then sign terms and conditions ahead of the auction. You’ll then be asked for all the documentation and certification required to sell, and a draft description of your home will be created by the auction and sent to you for approval.

Legal pack

At this point, you should appoint a solicitor to draw up a legal pack which will include title deeps, applicable searches, conditions of sale and other important documents and guidelines that will allow you to hand over your rights officially and successfully to the property to the highest bidder.

Marketing

Once your instructions and legal pack are all signed and completed, the auction will then start marketing your house to generate some interest and encourage buyers to come along and bid.

Most auctions will use social media, auction boards, publications, and websites to market your property, but the auction should keep you informed along the way.

Reserve price

The auction appraisal and results of the marketing will allow you and the auction to form an idea about the reserve price. You should consider the appraisal advice, along with the interest generated from the marketing, before setting a reasonable fixed reserve price – which is essentially the price of the starting bid.

It’s so important to gain a good idea of where you should set this price, as you’ll still be charged selling at auction fees, even if no one bids on your home. Bidders may be put off by a high reserve price, whereas they may fight with other bidders and drive up the sale if the price starts somewhere reasonable – but not below its worth.

Auction day

When the day comes, potential bidders will register for the auction, and most auctions will take copies of identification and carry out legal processes which prevent fraud and money laundering.

Bidders will then bid on your property – starting at the reservation price. Once someone wins, contracts are usually exchanged immediately. They’ll have to pay a deposit, which is usually around 10% of the selling price, and will usually be given a month to pay the rest.

Auction day can be nerve wracking – so it’s important to remember you don’t even have to attend as the seller.

Completion

It usually takes around a month for the sale to be finalized after the exchange of contracts. The auction will usually liaise with yourself and your solicitor to confirm dates of completion and other processes, such as the handing over of the keys, or access for the buyer.

For further information regarding auction or selling or purchasing your house at auction feel free to visit our Sharpes Property Auction Bradford