Traditional Method
of Auction

Traditional auction combines the certainty of an auction sale, along with the marketing effort of the auction house. Reserve prices tend to be lower with traditional auction compared to modern auction.

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Traditional auction has been around for a long time, in fact this is the original concept of an auction from the beginning.  It is the most popular method of auction as it is tried and tested, with property owners recognising the various benefits it offers.  As this article explains, the “traditional method” tackles many of the issues people experience in private treaty (estate agency) sales.
Traditional method of auction

How does the traditional method of auction work?

The traditional method of auction is unlike an ordinary estate agency sale, providing you with the certainty of a sale on a specific date – the auction date, in a completely transparent fashion.  To summarise briefly; the auctioneer has the role of drumming up interest in the property and conducting viewings. All prospective buyers are told when the auction day is and they can make an offer for the property by placing a bid online, in person or on the phone – the process for bidding is straightforward.
When selling through an estate agent, once an offer has been accepted the property is “sold subject to contract” discouraging other prospective buyers from making an offer – which is a major disadvantage to the seller.

The traditional method is very different; the sale is not dependent on just one selected buyer with an asking price stated, instead all prospective buyers are able to make offers and bid against each other.

The auction is very simple; the seller sets a reserve price (this is the minimum price the property will sell for) in preparation for the auction day (usually 4 weeks away).  On the auction day, prospective buyers compete against each other by increasing their bids until there are no more bids. If there are many bidders, there can be a frenzy of activity with the sale price continuing to increase – this ensures the property can achieve its top price.

The whole process of auction takes away control from the buyer –  instead of the offer price being potentially reduced by the buyer in the case of an estate agency sale (sometimes at the last minute), with the traditional method the price can only increase!  With an auction sale being a legally binding commitment with a large deposit put down by the winning bidder, the risk of the sale falling through is virtually eliminated.

There are two parts to the traditional method of auction: (1) an auctioneer generates interest in the property, conducts viewings and allows prospective buyers to bid on auction day. And (2) an auction encourages competitive bidding for the property and the certainty of a “sale date”.
It is as simple as that!  Property sellers seem to like the certainty of the traditional method because they can be confident of achieving a good price in a short space of time. And unlike a modern property auction, which is best suited for properties in good condition, the traditional method can be ideal for properties in need of modernisation or with the potential to improve – so there is increased certainty of a sale taking place.

The traditional method is suited to selling all types of property no matter what the condition – including those without an EWS1 form.

Bidding at traditional auction

To find out if your property and personal circumstances are suited to the traditional method of auction, call us on 020 7183 3022 for a no-obligation chat.

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