Buying and selling property through Online Property Auctions
Written by: Paul Thompson on 20th May 2021
Online property auctions have fast become a popular way of buying and selling property due to their speed and added security.
Buying and selling via online property auctions offers a range of advantages. It gives buyers the chance to purchase available properties quickly and with no chain. For sellers, a reservation fee must by paid upfront by the purchaser, offering more security than a private treaty sale.
In this article, we discuss the benefits of online auctions for both buyers and sellers, as well as how the online auction process works for each.
Selling a property through online property auctions: what are the benefits?
One major benefit of selling at an online property auction is that putting your property up for sale can be much quicker. An online property auction provides flexibility, in that auctioneers are able to offer bespoke auction dates to suit clients particular needs, therefore if a quick sale is required and you don’t want to wait weeks for an auction, you don’t always have to.
Online property auctions also attract potential buyers from a much wider area – nationally and even internationally. Attracting more bidders may means you can achieve a more attractive sales price.
As with room auctions, a sale at an online auction is effectively considered final, so there is less chance of a buyer withdrawing, reducing their offer or a sale falling through.
How to sell a property at an online property auction
The first thing to do when considering selling a property via online auction is decide when you want to sell and which auction you would like to enter.
Once you’ve decided that, you should contact your chosen auctioneer who will set up a free, no obligation auction appraisal on your property. They will guide you through the auction process based on your property's location and your requirements.
After inspecting your property, your Surveyor will provide an appraisal along with a recommendation on a suitable Guide Price and Reserve Price. The Reserve Price is especially important, as this ensures your property will only sell at a price you are willing to accept. The Guide Price provides an indication of what the property is expected to achieve at auction. Both the Guide Price and the Reserve can be subject to change right up to, and including, the day of the auction.
Be sure to ask for details of the fees for entering a property into the online auction and for selling it. Depending on the auction there may be an entry fee, buyer’s pack fee or seller’s commission to pay. Often, however, with online auctions, the buyer is required to meet most of the costs.
After agreeing a suitable guide price and reserve for the property, draft particulars will be produced for your approval before the property is listed online and viewings on the property can commence. At the end of the listing period, assuming the reserve price is reached, the virtual gavel falls and the property is considered sold.
For information on how to sell a property via online auction through Pugh, click here to view our selling guide.
Buying a property through online property auctions: what are the benefits?
There are a number of advantages of buying property at an online auction. Firstly, it can be quicker as you don’t have to wait for the next auction room sale date to come around (online auctions are usually held more frequently than room auctions). Also, you don’t have to visit the auction in person. This saves time and expense and means you can bid on a property from anywhere
For some, bidding at an online property auction can seem easier too, in some ways. It is perhaps less intimidating for those who may be uncomfortable in an auction room atmosphere. You can also bid from anywhere, anytime 24/7.
Online auctions are more transparent. It is easier to follow the progress of the bidding on lots compared to a fast-moving auction room. Online property auctions are in some ways safer for the buyer because you are less likely to be drawn into a bidding war and end up paying more than you anticipated.
How to buy a property at an online property auction
Start by searching for lots you are interested in bidding on. You will normally need to pre-register before you can bid on a lot. This may include payment of a reservation fee or deposit in advance. You will also need to undergo ID and anti-money laundering checks.
Next, view the property if you want to, and if viewings on the property are available. Obtain the legal pack and take any expert advice you feel you need. You then need to decide your maximum bid for the property, whilst considering any buyers fees and additional costs.
Once the online property auction opens make your bids online, subject to any minimum bid. With most online auctions you can make an opening bid and opt to receive notifications if you are outbid. You can then decide if you wish to increase your bid or not.
It is also a good idea to look into auction finance if you need it, and have a solicitor or conveyancer in place, before bidding. This way you will be ready to move quickly if are the successful purchaser.
For details of how to bid online with Pugh, click here to view our online buying guide.
Looking to buy or sell property via online auction?
If you are looking to buy a property via online auction, click here to view all upcoming auction dates and lots we currently have for sale. If you have a property to sell, click here for a FREE auction appraisal.
Written by: Paul Thompson on 20th May 2021