An auction is an efficient and cost effective way of selling property and, if prepared properly with intensive marketing, advertising and mailing, will result in the greatest possible exposure of the lots offered. To maximize the effectiveness of the marketing, considerable thought must be given to the guide price, which needs to be tailored to generate competitive bidding in the auction room, thus ensuring that the bet price is being achieved.
Although some properties are more suitable for sale by private treaty, taking this route does present uncertainties over terms such as sale price and timing of exchange and completion.
Selling by auction, however, offers a high degree of certainty that a sale will be achieved on a given day and, significantly, on the fall of the gavel an immediate binding contract is formed. As no further negotiation is permitted the entire sale process, from instruction to exchange of contracts is achieved within as little as six to eight weeks.
For vendors with a large number of properties to sell, auctions provide a highly efficient method of sale allowing for a total or phased disposal programmed selling in individual lots thus maximizing receipts. For those selling in a fiduciary capacity, there is the added advantage of the sale being entirely open and transparent. Most types of property are suitable for auction provided that a realistic reserve price is agreed.
Who Sells at Auction?
Auction is now regarded as the optimum method of sale for many sellers who range from private investors and property companies to banks, housing associations, and local authorities.
Auction Day
At Herbert R Thomas auctions is not uncommon for 200 to attend, creating a buzz and an atmosphere which are crucial to the success of the sale. If you have never sold at auction before, you may want to attend a Herbert R Thomas auction. The atmosphere of the room can be extremely exciting and competitive.
The Fall of the Gavel
On the fall of the Auctioneer’s gavel, a binding contract is effected. The purchaser may not renegotiate and cannot change any of the terms stipulated. The successful bidder is required to provide the name, address and telephone number of the purchaser and the purchaser’s solicitors. The successful bidder will also be asked to provide a cheque for 10% of the purchase price. Identification of the purchaser is always checked at this stage. Clearance of all deposit cheques is arranged immediately after the auction.
Exchange of Contracts
The Memorandum of Sale is made up in the room and given to the purchaser to sign. The exchange is overseen by a solicitor. We will forward the purchaser’s signed Memorandum of Sale to your solicitor. Completion will usually take place 28 working days later. The deposit funds are then paid to you less our fees.
What happens if the property does not sell on the day?
If your property fails to reach its reserve in the room, someone may still wish to buy it. You will need to decide whether to accept any offer and advise us accordingly. The property may even be sold in the days or weeks after the sale as we continue to market the property.
Why Herbert R Thomas?
Market Leaders
Herbert R Thomas has been synonymous with auctions for many years and as a result has the staff, depth of experience and reputation necessary to hold well attended auction sales and ensure a successful and profitable outcome for your property disposals.
Impartial Advice
When advising on sales we will always consider whether a property is more suitable for sale by auction or private treaty. Herbert R Thomas offers both methods. Our auction and private treaty departments effectively work as one team ensuring that our advice is impartial and carefully considered.
Quick Results
The entire process, from instruction to exchange of contracts, can be achieved within as little as six to eight weeks. Our experienced team offers a streamlined service aimed at securing the best price for your property with the least amount of stress.
By Auction, Herbert R Thomas offers sellers
- Guaranteed unrivalled exposure to the market
- 400 catalogues mailed out each auction
- 4000 property buyers and investors registered on line (UK and abroad)
- Advertising in national, trade and local press for every property
- The knowledge that, with a realistic reserve price, the property will achieve the best possible market value.
- The same care, attention and thoroughness for each lot
Competitive fees
N.B. Auction properties are sold unconditionally i.e., not sold “subject to contract”, “subject to finance” or “subject to survey”. In other words, the successful bidder is legally obliged to complete the sale.
ENTERING a Property into Auction
If you have a property to sell, please contact one of the Auction Team who will arrange a free, no obligation, auction appraisal and advise whether they think your property is suitable for sale by auction or an alternative method.
1. When do you want to sell?
Decide when you want to sell your property and which auction you would like to put it in. Sale dates and venues can be found on our website.
2. What information do we need?
In order to give you the best possible advice we will need the following details:
- Address
- Description
- Photograph
- Tenure and Tenancy (if applicable) details
- Floor plan or site plan
- Anything else you consider to be material
Once we have received this information, we shall provide an estimate of the likely sale price of your property at Auction. Together with a proposed reserve, we shall send you a copy of our standard agency contract setting out our terms and conditions. Once the maximum reserve price is agreed you will be asked to sign and return our standard agency contract to confirm your instructions, at which time the Entry Fee becomes payable.
3. Proof of Identity
If Herbert R Thomas has not sold for you before we shall require proof of your identity and address before we can market your property.
4. How much does it cost?
Auction Entry Fee
Herbert R Thomas charges a fee to enter a property into an auction. This fee is payable whether the property is sold or not. The fee is a contribution toward the cost of marketing and catalogue production. The fee will depend on how much space is taken in the catalogue for the property.
We shall advise the most appropriate amount of space to be taken. Most lots appear on a half page within the catalogue.
Commission
Our surveyors will confirm the auction entry fee and commission rate with you in writing before accepting your instructions.
5. Sales Particulars
Once we have been formally instructed, the property will be inspected by one of our surveyors, measurements taken where appropriate, and the property will be photographed.
6. Legal Documents
At the same time your solicitors will be instructed to prepare a legal pack containing special conditions of sale, title documents, leases (where applicable), searches, planning documentation and office copy entries so that they are available to interested parties either by post or on line.
7. Guide Price
Our auction team will recommend a guide price which you will need to approve before marketing begins. It is important to set the guide price at a realistic level which is attractive to buyers. This will generate competitive bidding in the auction room and ensure that best value is achieved.
8. Marketing your Property
Marketing will start approximately three to four weeks prior to the auction sale.
Catalogues
We produce around 400 catalogues for each auction. These are sent to prospective buyers such as private investors, property companies and developers, landowners and adjoining farmers.
E-marketing
Our catalogue is available online and we send regular email alerts to the private investors who are registered on the site.
Advertising and PR
We advertise in the key property publications and place advertisements in local newspapers. We often achieve editorial coverage in addition.
Targeted Marketing
We target individuals who have previously expressed an interest in similar properties, as well as adjacent occupiers, local agents, local developers, builders and property companies.
9. Potential Buyers
Viewings & Surveys
Potential purchasers may want to view your property during the marketing period and have a survey carried out. Let us know how you would prefer viewings to be arranged and we shall arrange access for buyers. In most cases, vacant properties are open at pre-arranged times for viewing. Details will be printed in the catalogue.
Legal Documentation
In conjunction with your solicitors we will supply copy documents to prospective purchaser’s solicitors and will keep you constantly updated as to the levels of interest shown. We have developed an innovative and user friendly online document system in order to speed up the handling of requests for documents.
10. Reserve Price
We will agree a reserve price with you for your property a few days before the auction. This is the level below which we will not be authorised to sell. It is important that this be set at a realistic level. If you think you have a property that is suitable for auction, please do not hesitate to contact us.