Why Connect UK says traditional property auctions will always beat modern methods

1. Speed – you’re looking to sell in the shortest possible time as nobody wants the process to take any longer than necessary.

2. Security – people turn to auctions knowing this method of sale eliminates all risk of fall-throughs.

3. Highest price - most significantly that the highest sale price is achieved.

The traditional method of auction will always triumph over the modern method of auction. Let’s find out why.

Speed

Our traditional method of auction says that your property or land will be auctioned ‘in room’ to bidders as well as live internet virtual bidders and buyers over the phone all at the same time. Once the gavel falls to the highest bidder contracts are exchanged with completion just 28 days later.

The modern method of auction shares similarities with ‘eBay’ style bidding where buyers bid online only and once a bid has been accepted the buyer has 28 to exchange and a FURTHER 28 days to complete.

So, this tells us that the modern method of auction takes exactly twice the amount of time once a bid is accepted.

Security

Many people turn to auction after experiencing a fall-through or even numerous fall-throughs. Anyone who has been in this situation knows the stressful journey.

The traditional method of auction states that once the gavel falls contracts are exchanged and the sale is legally binding, meaning neither the buyer or seller can pull out. But in the modern method of auction, a physical auction does not take place. Once a bid has been accepted, the buyer still has 28 days to exchange.

Although the buyer may have paid a reservation fee to the agent, they ARE still able to pull out anytime within these 28 days as there is no legal obligation to complete. Fall-throughs are STILL possible after the highest bid has been accepted.

Price

Sellers are always looking for the highest price possible while buyers are looking to pay the lowest price possible. The traditional method of auction states that no fee is paid by the buyer until the fall of the gavel and the exchange has taken place.

The modern method of auction states that a reservation fee is paid – prior to exchange, generally up to 5% of the purchase price and is non-refundable. This fee is also included in the buyer’s stamp duty calculation.

Sellers – which method do you think a buyer for your property or land would prefer?

So let’s recap.

Sale speed - traditional auctions immediately exchange and complete in 28 days. The modern method of auction exchanges and completes in 56.

Security - traditional auctions secure the sale at exchange and the sale is legally-binding. The modern method of auction allows buyers to pull out during the 28 days up until exchange after confirming their winning bid.

And lastly, price. Traditional auctions do not require the buyer to pay any fees or deposit until the exchange of contracts. The modern method of auction requires buyers to pay a hefty reservation fee, 28 days prior to exchange, which is also included in their stamp duty calculation.

Make sure you choose the right method of auction for you.

Find out more about traditional auction-selling with Connect UK Auctions today, or call 01293 528575.