Property auctions are an increasingly popular way to sell houses in 2020. They’re also very effective, with over 80% of all properties selling. However, approximately 20% of properties put into auctions do not sell for a variety of reasons. Some of which we will discuss in this article. Today we look at the question – What happens if your property doesn’t sell at auction.
Why Did My Property Not Sell at Auction?
There can be a variety of reasons as to why your property failed to sell at auction. The most common reason is down to the reserve price being set too high. If the reserve price is not met then the property will be classed as “unsold”. You can adjust the reserve price, but this will then need to be entered into a new auction. This wastes time and will cost you additional fees.
When putting your property into an auction it’s also vitally important that prospective buyers are able to view the property beforehand. It is very rare that people will buy a house without seeing it. Allowing them access can give you a better chance of selling your property on the day of the auction.
The third and final reason could be down the legal element. Before a property can be entered into an auction you will need to obtain a legal pack from your solicitor.
What Are the Costs if my Property Did Not Sell at Auction?
There are costs which sellers may be liable for even if the property does not sell at auction. Usually, these may be the solicitor’s fee for preparing any legal documents, or any associated entry fees by the auctioneer. As the property did not sell, no commission will be due to the auctioneer.
Will it Affect The Value of My Property?
No, this should not affect the future sale or value of your property. However, do be aware that if a property is seen at auction multiple times then it will make buyers wary. They’re likely to think that as it’s not selling then something must be wrong with it.
If you are concerned about the property not selling then speak with the auction company. He or she will be able to explain to potential buyers the reasons why it has not sold previously.
Can I Enter My Property Into Another Auction?
Yes, you can enter your property into a new auction. This can be done at the same auction house as before. Some auction houses will also allow you to enter the next auction without any other associated fees, however, you may have to pay additional admin costs.
Depending on the reason why the property didn’t sell at auction, the auction house may require you to make some changes to the marketing or reserve price. Lowering the reserve price may seem risky but is a great way of generating more interest at the next auction. If it was due to a legal pack error then the auction house may ask for this to be submitted earlier next time.
What Are My Other Options?
There are a number of options if your property did not sell at auction. Some of them include:-
- Use an Alternative Auction
If you still want to pursue a sale through an auction then you can always look at other auction companies in your area. Most auctions will operate in the same way so don’t expect any miracles. Just make sure they’re marketing material is high quality, they have a large database of potential buyers, and they’re realistic about the reserve price.
- Sell Through an Estate Agent
If you don’t want to drop your reserve price then an option is to use a local estate agent. They should have a vast network of potential buyers and they can get your property in front of them by advertising on Rightmove or Zoopla. An estate agent should also be able to give you an accurate view of the property’s true value (work out how to figure out the value of your property here).
One thing to consider when using an estate agent is the amount of time your property could take to sell. On occasion, it can take up to 6 months to a year to find the right buyer, so if you’re looking for a quick sale then either try your luck at an auction again, or consider using a property buying company.
- Sell to a Property Buying Company
Selling your home to a property buying company like Norwich Home Buyers is a fast and efficient way of selling your property. We have cash funds available, once we agree on a purchase price with a seller then we can start the conveyancing process straight away. We aim to have the funds in your account in 30 days. This means that you are not waiting for months on end hoping that a buyer will come along, only for them to pull out at the last minute anyway.
It’s true, you’re likely to get more for your property when you sell through an estate agent. However, if you want a quick and easy sale then selling to a company like Norwich Home Buyers could be your best option.
If your property did not sell at auction then you have a few options. Remember, the most likely reason it didn’t sell is that the reserve price was likely too high. But then again, you can’t guarantee with property auctions that the right buyer will be there on the day.
If you’re looking to sell your property quickly and don’t want to put it into an auction, then contact Norwich Home Buyers today by filling out our offer tool or by calling the team on 01603 851837.