Selling your house at auction
There are several ways of marketing your house for sale. One such way is to put it up for sale at an auction. This article will take you through the process to ensure that you are well informed and consequently able to sell your house at the best price.
Why would you want to sell your house at auction?
The main benefits of selling your house at auction are that it is a lot faster as compared to the conventional conveyancing process. It will take a month for the property to go up on an auction. If an offer is accepted, then the sale will be completed in 28 days.
No chance of sale falling through
Furthermore, contracts will be exchanged once the hammer falls. Therefore, you can be confident that once a bid is accepted there will be no chance of the deal falling through.
You can get more than market price
Auctions can get quite competitive. The price can quickly go up if multiple buyers are bidding on your house.
Why would you not want to sell your house at auction?
Auction houses can be costly. You will have to pay the auctioneer a percentage of the sale price. You may also be asked to pay for other costs incurred on marketing your home.
Some people do not buy at auctions thinking that all properties for sale at auctions are distressed.
The right kinds of people must be participating in the auction. Otherwise, you could lose out.
How much would it cost to sell your house at auction?
Auctioneers usually charge approximately 2.5% of the price you get for your property. Furthermore, it would help you to find out if you will be charged an advertising cost.
Further, you will be required to hire a conveyancer to do the conveyancing process on your behalf on the day of the auction. You will incur a cost for the conveyancer.
Accepting an offer before the auction
In all probability, it will not be a good idea to sell your house before it goes up for auction. It will be better to see the response you get from the multiple people at the auction.
Setting the reserve price
If someone at the auction offers the reserve price and there are no further bids, then your auctioneer will drop the hammer. After this, you will not be able to back out. So set your reserve price after careful thinking and research.
If no one offers the reserve price, your property will be withdrawn from the auction.
However, even if your reserve price is too high, you can talk to a buyer after the auction and offer a lower price.
What are guide prices?
The auctioneer will market your house on various platforms along with its guide price. The guide price is used to lure in buyers. It is only a rough idea of the lowest price you will be taking. You are not bound to accept an offer at the guide price.
What do you need to do before auction day?
- Market your house – do not entirely rely on your agents to do all the work. You need to attract the right kind of buyers to the auction. Market your house in a variety of ways using social media, online advertising, print media, telemarketing, to name a few.
- Stage your house – make sure your home is in its best condition for possible viewings. It will make your house more saleable.
Selling your house through online auction
Online auctions are gaining more popularity as the modern method of selling your home. Online auctions allow you to bid on properties online. As a substantial reservation fee has to be paid upfront by the buyer, this is a lot more certain and faster way of selling your home. For further information, please read our article on selling your house at an online auction.
Please note that the information provided on this page:
- Does not provide a complete or authoritative statement of the law;
- Does not constitute legal advice by Net Lawman;
- Does not create a contractual relationship;
- Does not form part of any other advice, whether paid or free.
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