As costs of living rise at their fastest rate in decades and interest rates are pushed higher, the housing market is inevitably being impacted. Selling land and property by online auction continues to go from strength to strength, with transaction numbers up by 30% year on year. We caught up with Associate Director and Head of Auctions, Tom Dennes from our agency team, to find out his thoughts on why online auctions offer a dynamic alternative to the traditional property auction house.
“Our successful online auction service gives vendors and buyers certainty, with some impressive results in recent sales. We originally started offering online auctions as a new service line before the pandemic, with rural, residential, and commercial clients all seeing the benefit of this method of sale. For a seller, there is transparency and certainty to selling by online auction, appealing to private sellers as well as public bodies and charitable institutions who need to be able to demonstrate that the best price has been achieved in the open market.
“We still find that some people are nervous about this method of sale initially because some still have a phobia about doing everything online, with no personal face-to-face contact, or they are just not tech confident. With a traditional auction room, there is a real buzz about it and you can see the people in the room; the downside is that the auctions rattle along at such a pace that there is no clear picture about who is bidding. The hammer goes down and it’s all over in a matter of minutes and you’re left pondering how you managed to miss out.
“The online auction process provides complete transparency - a full legal pack is prepared before the auction can commence, thus disclosing all legal aspects of the sale to the buyer and their advisors in one bundle. It only then remains for the buyer to inspect the property, take advice from a builder and other advisors as needed, and then make an informed decision about making a purchase. The auction will run for typically 4 weeks at the end of which both the buyer and seller will achieve certainty when the auction ends and the clock goes to zero. No change of mind. No additional legal fees following aborted sales. No frustrating delays.
“Our buyers tell us some of the things they love about the process are that they can see all the bids displayed on the computer screen which gives them plenty of time to work out their next bid. Once the reserve price is met, any additional bid made resets the clock by five minutes, allowing any eager buyers gathered around the laptop to have a proper chat about their next offer. Resetting the clock can happen multiple times as increased offers land, meaning that an online auction can often end twenty to thirty minutes after the published end time.
“In this increasingly challenging market, our online auction facility offers an opportunity to engage with our auction services in a swift, efficient and transparent way; perhaps the ultimate open market test. Our online land and property auctions run 24 hours a day, 7 days a week meaning there is no need to wait for the right collective auction to join.
“Whether it is a residential property, a parcel of land or a redundant building, the online auction can be an ideal way to dispose of an asset quickly. For public bodies or charitable institutions, transparency is key to demonstrating that the best value has been achieved. Properties can be very easily listed, and buyers can bid from anywhere. Some bidders in an auction room can be impulse driven to act, or not, whereas the online system presents a less pressurised environment that allows consideration and can create greater commitment.
“We have some great examples of recent successes which include a very appealing block of land, about 2.60 acres in all, on the fringes of the village of Kelsall, which sold for £108,500 after heated bidding; 88 bids were placed and it sold for nearly 2.5 times the guide price of £45,500. A growth area in the last year is commercial online auctions, our Knutsford office offered an office block for sale in Sandbach which attracted a lot of interest, finally selling for £526,500 after 81 bids, more than 1.5 times the guide price of £340,000.
“Toby Gale-Hasleham in our Chester residential agency team was quick to realise the benefits to his clients of online auctions and is now one of our most successful online auction experts, recently selling an achingly pretty cottage with 3.29 acres in the Snowdonia national park for £435,000.”
Key benefits of online auctions
Flexibility: You decide when to sell making it much easier to plan the transaction
Commitment: A less pressurised environment than a public auction, encouraging buyers to participate
Focus: concentrated periods of promotions with demand from motivated cash buyers
Competitive: The ultimate open market test to create the maximum sale price
Security: All buyers have ID verification and are approved to bid
Exposure: Comprehensive marketing campaigns
Certainty: Legally binding exchange occurs online with a deposit being paid
Transparency: A highly visible process for buyer and seller
Click here to listen to our Fisher German Talks podcast about online auctions and here to read our online auctions brochure.
Do get in touch if you would like to find out more about our online auctions or click here for more information.
