Buying or selling at auction? 5 Common myths debunked

Hello and thanks for joining me again for this month’s blog.

Before I get into the nitty gritty, I want to start by offering a sincere thank you to everyone who has helped us along in this exciting journey so far.  Leaving a safe job to start a company in the middle of a global pandemic isn’t a decision I made lightly however I also recognize it wasn’t without risk.  It has been an incredibly positive first month with the website being launched, social media pages created, meeting new contacts and the company name going out to anybody that will listen.  All our progress so far would not have been possible without you so thank you very much.

In this blog, I have decided to try and debunk a few myths about the auction industry.  Auction is a great way to buy or sell properties so when I hear people getting it wrong it really frustrates me.  What better place to try and address that than this very blog so here goes: –

Property is at auction, what’s wrong with it?

Absolutely nothing, selling at auction is a brilliant way to sell a property.  Competitive bidding can drive the value up.  The seller gets the security of the buyer paying a 10% non-refundable deposit and the completion time is only 20 working days so usually around 2-3 weeks quicker than selling on the open market.  If there is something wrong with the property then just like a house on the open market, it will show up in the Home Report.  If there is work needing done, then that will likely be reflected in the home report value and you will have the opportunity to add some immediate value to your purchase.

Buying at auction is only for cash buyers.

Not true.  Property auction purchases are available to everyone.  There are a few things to investigate though.  Completion time can be quicker than when buying on the open market.  You will need to check with your mortgage advisor to see if you can get your mortgage through in the required time scales (typically 20 working days, or 28 normal days in real terms).  If you can’t then don’t worry, in most cases sellers will be happy to extend the completion period if they can agree a deal they are happy with. All you need to do is let us know before offering and we will ensure the seller is aware.

Please also speak to your mortgage advisor to ensure the property is mortgageable and your mortgage is agreed.  Once you have offered and paid the deposit then you are committed to the purchase.  If the property is not mortgageable then your mortgage advisor may be able to offer alternative financing such as a bridging loan.  You will need to take professional advice on this though,  at Green Door Property Auctions we have a number of mortgage advisors we are in regular contact with, should you want us to put you in touch with someone then just let us know.

Selling at auction? Wow, I’ve heard that is expensive!

No, it’s really not!  At Green Door Property Auctions, we only get paid if your property sells.  If we manage to find a buyer for you then all you pay us is the fixed fee of £500.  Other than that, it will just be the Home Report and your solicitor’s fees. I am afraid they would need paid regardless of how you sell your property though.  I feel like I should beef this paragraph up a bit but there really is not much more to say.  £500 to sell your property, that is it, no hidden costs, no scary large bills to come later. £500, that is it.

Selling at auction is just giving the property away cheaply!

There is no denying, some people who buy from auction are looking for deals, aren’t we all!  That said though, it’s not us that will dictate the value of your property, the market will do that.  It is a cliché however the phrase, “it is worth what someone is willing to pay.” rings true to an extent.  I say to an extent as we know it’s not quite that simple.  There may be times where you want to sell it for any amount, however you may have other commitments that mean it is just not possible.  At Green Door Property Auctions, we always agree a reserve price with you, this is the lowest amount you would be willing to sell it for.  If you get offers lower than the reserve price, then it is entirely up to you whether you want to accept it or not.  Please do not confuse selling at auction to a quick buy company.  There is a time and a place for companies like that and good luck to them, we are different to them though.  When you put your property to auction, you are trying to get the best price and with your property being exposed to the biggest property portals Right Move, Zoopla, On the Market and Prime Location then what better way to do that?!

Buying at auction is risky.

Research, research and research a bit more.  I mention this in my buyers guide on our website, but I can’t stress it enough.  Buying at auction is not any riskier than buying on the open market, it is simply that you should be doing your research before offering.  Read the home report, request the legal pack, take legal advice, speak to your mortgage advisor and do your sums.  If you do all those things and are satisfied with the answers you get then there can be great deals to be had.  Don’t be scared and if you do have any doubts just give us a call and we will help in any way we can.

Right, I think I can relax a bit now I have all of that off my chest!

Thanks for reading this blog.  I know it morphed a bit between a sales pitch and a blog at times.  I would say I am sorry for that but I’m not really (where’s that winking emoji the kids use?).  I am proud of this company, what we can offer, and I am delighted to be shouting it from the roof tops. I just hope you have found this useful as well.

Anyway, we are in December now so it’s officially the Christmas period in my house.  I know it’s been a strange year to put it mildly, there’s light at the end of the tunnel though and 2021 looks like it’s going to be a fantastic year with us all really appreciating things we possibly took for granted in the past.  I would like to finish off by wishing everyone a Happy Christmas and I hope you have a wonderful new year.   I am looking forward to getting to know lots of you in the coming weeks and months.

All the Best