Property auctioning is becoming an increasingly popular method by which people are buying and selling their houses. Estate agents are losing favour to property auctioneers, who take on virtually all aspects of the selling and buying process for you. An auctioneer will act as the sole agent involved with the selling of a house if it has been chosen to sell at auction, thus their responsibility is great in the process.
When would I need a property auctioneer?
Quite simply, a property auctioneer is needed if you have decided to sell your house at auction. A property auctioneer is involved with all steps of the process of selling your house, from producing the prospectus to signing the final contract. Many of the responsibilities which an auctioneer takes on are similar to that of an estate agent, it is merely the method of the selling which is different.
What does an auctioneer do?
The auctioneer is a type of surveyor who advises buyers and sellers about the property, thus they are involved with gathering as much information as possible about the property to help advise their clients how best to proceed.
- Initially they will visit the property to measure, inspect and assess it.
- They will then use these findings to produce an accurate report on the property, which is similar to a set of particulars produced by an estate agent. This report will be given to potential buyers so they are informed about the property's details.
- The auctioneer will also perform a valuation on the house to help guide the seller with what sort of price it is likely to reach.
- The auctioneer then has to advertise and market the auction to give it its fullest publicity possible.
- The live auction is then run by the auctioneer who has to manage the bidding process and keep the atmosphere lively in order to reach the required target or higher.
What do I need to get from the auctioneer if I want to buy at an auction?
- Firstly you need to get a catalogue of all the potential houses that are available to buy through auction in your desired area from the auctioneer. Properties are referred to as "lots" and often auctioneers will have copies of these online for your ease of use.
- If you see a house that you like, approach the auctioneer directly so that you can be sure to have the most up-to-date and accurate information.
- It is often worth getting professional advice before you consider bidding for a property to make sure that the information that you have been given is correct. Carrying out a valuation and survey of the lot is also advisable to make sure that you are setting an accurate target for your price.
- It is also vital that you inspect the property for yourself and compare it to the prospectus to check that the information accurately corresponds.
- From the seller’s solicitor you need to get the legal pack, which contains deeds, title information, leasehold documents and any searches which have been done on the house.
- Also you need to enquire about whether there are any special conditions of sale before you actually take part in the auction.
- From the auctioneer you then need to get a price guide, bearing in mind this can change at any point throughout the marketing period so make sure that you keep up-to-date on this and get the final guide the day before the auction.
- The day before the auction, or at the actual auction itself, you need to get the addendum from the auctioneer. This includes any supplements or changes that have been made to the catalogue which might affect the property of the sale.
- Once you have decided on your maximum bid price you have to arrange the finance for this. Firstly, a deposit will be needed on the day which is usually 10% of the total price of the sale, and then completion normally happens within 20 days of the auction day.
- One of the most important things you need to find out before the auction takes place is what type of auction it will be. If you, your solicitor or agent cannot attend on the day then you need to find out what the procedures are for telephone, proxy or internet bidding.
- It is best to check with the auctioneer what their procedures are surrounding paying the deposit, signing the memorandum of sale and whether the sale is subject to VAT or not, and if it is how this will affect the deposit.
- You also need to investigate what the pre-registration process is, and what ID you will need to bring to the auction with you.
- On the actual day make sure you arrive in plenty of time to check the addendum for any alterations as well as being able to listen to the auctioneers opening speech which may also include any announcements concerning the lot.
What do I need to get my auctioneer to do if I wish to sell my house at an auction?
- The first thing you need to ask an auctioneer is their opinion about the saleability of the property.
- If they think that the house has ample chance of being able to reach a good price at auction it is then their job to survey the house.
- They have to recommend what they think the guide and reserve prices should be. This will make sure that you know what the approximate price your house will sell for, and the reserve stops it selling for a price less than you are willing to accept.
- The auctioneer will then arrange a time and place for the auction.
- Following this you will need to ask the auctioneer for the terms of appointment and these need to be agreed before the sale progresses any further. The terms of appointment include what their commission will be if the property sells at auction, or what it will be if it is withdrawn before the auction or does not sell. The auctioneer will also define in these terms their right to end or change the appointment, to instruct a solicitor to create the legal pack and conditions of sale, and to be present at the sale. They will also determine with you their right to manage proceedings in the auction room, to act on your behalf and to sell the property at the reserve price.
- The auctioneer will also ask you to establish with them what procedures you would like to take regarding biddings, how to advertise, making amendments to the guide and reserve prices, and what will happen if the lot goes unsold.
- The auctioneer will then prepare the particulars for your property.
- Your auctioneer will tell you about the level of interest there has been in the property so as to give you a guide of whether you will meet your reserve, or whether you will sell for more than you expected.
What regulations do auctioneers have to follow?
There are a number of statutory regulations which auctioneers have to follow, including the Estate Agents Act 1979, and those for chartered surveyors which are the RICS rules of conduct. The particulars that the auctioneer creates about the property have to comply with the Property Misdescriptions Act 1991, and an auctioneer will often have to liaise with a solicitor to check that everything has been revealed to the public that is legally necessary.
How much will it cost to hire an auctioneer?
The fees are relative to the responsibilities, duties and time that you require from the auctioneer, as well as the size of the property. If you are going to be selling it for a large sum, then obviously the cut they will take will be relative to this.
What qualifications does an auctioneer need to have?
The first step to becoming a property auctioneer is to train as an estate agent or surveyor, which gives a grounding into the real estate profession. Further training into the methods of an auction then need to be taken, which will explain the role and knowledge of an auctioneer. This is not an academic training, and will be conducted under the supervision and guidance of an already qualified property auctioneer. Make sure that the auctioneer you choose is registered with The Royal Institute of Chartered Surveyors, and The Institute of Revenues, Rating and Valuation.
Where do I find a property auctioneer?
Like estate agents, many property auctioneers are starting to set themselves up on the high street and will be able to help you on a walk-in basis. It is often advisable to get prior recommendations from friends so you know that the auctioneer is good and reliable. The RICS website and the IRRV website contain listings of property auctioneers.