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The Modern Auction

There are two ways of auctioning a property. What are the differences and benefits of the Modern Auction?

There are two ways of auctioning a property. The traditional auction, an unconditional sale and the modern auction, a conditional sale.

In a traditional auction, conducted in a sale room, the transaction is legally binding for both bidder and seller the moment the hammer falls. A 10% deposit is paid on agreement of sale and contracts are exchanged immediately. A period of 28 days is allowed for completion of contracts.

A modern auction is live for a set period of time, normally 30 days, and at any point during this period a prospective buyer can place a bid. At the end of the auction the successful bidder pays a reservation fee.

The vendor can opt to pay no fees and whatever the property sells for the vendor keeps. However, there is a small cost to sellers for the preparation of an EPC and Auction Pack. On the acceptance of an offer or at the close of the auction, the buyer places a non-refundable reservation fee and we charge the buyer a percentage of the purchase price to cover our costs. The buyer is then given 56 days to exchange contracts and complete the purchase.

George Pickard of Andrew Grant’s Country Homes said “ A property will always sell for what it’s worth and with this method of sale a reserve price will ensure you that the property will only sell for what you are happy with. Fixed time scales for exchange and completion provide clarity, confidence and speed which is beneficial to both vendor and buyer. Buyers will gain confidence through the totally transparent bidding process which reassures them they are buying for the open market price.”

If the sale falls through due to an act of the vendor, the reservation fee will be refunded to the buyer in full. If the sale falls through because of the buyers actions, it is non-refundable.

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