A large part of our success over the last 30 years has been achieved through strong relationships with a great many Independent Estate Agencies and other introducers who recognise the value to their clients of a public auction facility and who have welcomed our ability to provide that specialism and expertise, when looking at the best option for any property.
This has enabled us to work together as Joint Auctioneers, in providing the widest possible, national, regional and of course local coverage to create interest and competitive bidding, to the benefit of the seller.
Selling by public auction is an open and transparent method of sale and for the correct type of property, usually one where supply and demand are out of kilter, a sale by auction will lead to a better price being achieved through competitive bidding and with the very real benefit of an exchange of contracts on the fall of the auctioneers gavel.
These are just some of the reasons why sale by public auction, the oldest established and still used method of sale, remains relevant in today’s increasingly digital age.
There have been attempts to reinvent the wheel with some estate agents offering their clients the “modern or alternative method of auction”. It is a big stretch of the imagination to attach the word auction to this method of selling, though some are lured in by the prospect of something “new” or perhaps the offer of “no selling fees”.
On the face of it, no selling fees sounds an attractive proposition, but as we all know, rarely in life is there any such thing as a free lunch or in this case a free service as someone always ends up paying!
Any potential seller considering such a proposition should consider that if they’re not paying who is and why does it matter? The reality is that buyers and sometimes even interested parties are charged often eye watering sums to the agent to progress an interest in a property, which can be off putting in itself. Who pays does matter, because ultimately these extra costs and charges are coming out of their home buying pot. In most cases from a deposit rather than a mortgage or other finance. If Mr and Mrs Smith have £300,000 to spend on their purchase and £15,000 is swallowed up in additional fees to the agents, it stands to reason that there is only £285,000 left to pay for the new home. So, having potentially achieved £15,000 less for their property, has the seller really had their “free” lunch?
One should also consider that with the “modern method” that exchange of contracts does not take place on the fall of a gavel, with the buyer having ample opportunity to drop out, with none of the significant fees they have paid, going to the seller as compensation, who is left with a legal bill and back at square one.
This also raises the question of who the agent is working for? While there is of course a duty of care to treat all clients fairly, ultimately it is the seller who is the client and who’s best interests should be represented and protected by any agent or auctioneer. However, if the buyer or even an interested party is being asked to pay the agent significant sums of money, that obviously changes the dynamic and surely means the buyer is also entitled to consider themselves to be the agents client and so entitled to expect the agent to be working in their best interest? Can any agent really represent the best interests of two clients on opposite sides of the same transaction?
About the Author:
Sam Kinloch
Sam’s career in the dizzy world of property auctions began when he hung up his chainsaw and headed in from the forest. Joining the team in 2003 Sam now sits on the Board of Directors and has been instrumental in the adoption of online auction services. Out of the office you can find him flying around the velodrome or sipping coffee at a local café.