Seller's Guide
How our land and property auctions work
Selling your property, be it a cherished home or an investment asset, should be an exhilarating and seamless experience. This is the core belief at Herbert R Thomas, where we offer a swift, reliable, and secure service.
Herbert R Thomas presents two distinct online selling options:
- The Traditional Auction: Our traditional online auction ensures an immediate sale once the auction period concludes. If the reserve price is met or surpassed, the exchange is instant, mirroring the immediacy of a live auction room, but with the convenience of being online. Properties available through this route are labelled "Traditional."
- The Conditional Auction: Our conditional online auction allows the successful bidder 20 working days post-auction to formalise the exchange, providing time for financial arrangements. This flexibility often attracts more potential buyers. Properties available under this option are labelled "Conditional."
At Herbert R Thomas, we ensure a trustworthy bidding environment by pre-authorising all bidders and mandating the provision of payment details before bidding. Upon winning, bidders must promptly fulfil the payment obligation, assuring seller confidence in the transaction's completion.
Our guide
1 Selecting the Right Sale Method for You
Deciding on the right sale method is crucial. You have two options: a traditional online auction or a conditional online auction.
In a traditional online auction, the exchange is immediate once your chosen auction duration ends. This method is ideal if you're looking to complete the sale within 30 days of listing and are targeting cash buyers or those with pre-arranged financing. The buyer will pay a deposit as part of the purchase price at this stage.
On the other hand, a conditional online auction involves entering a reservation agreement with the buyer at the auction's conclusion. The actual exchange can take place up to 20 working days later, allowing for a longer completion time of up to 56 days from listing. This option may attract a broader range of buyers, including those needing a mortgage. In this scenario, no deposit is required immediately as the exchange has not yet occurred.
2 Establishing a Reserve Price:
Determining a reserve price is crucial, as it represents the minimum figure you would accept for your property. It's essential to set a realistic reserve to remain competitive in the auction market. We will assist you in this process, and upon agreement, you will need to sign a contract and provide identification to comply with Anti-Money Laundering regulations.
3 Choosing the Auction Duration:
The auction timeframe can be set for up to 30 days following the online listing date. A longer auction typically garners more bids, increasing the likelihood of reaching the property's maximum market value. Nevertheless, if urgency is a priority, a shorter auction period can be arranged for a faster transaction.
4 Preparing the Legal Document Package:
Before the auction commences, a legal document pack must be uploaded. Our team can connect you with our partnered auction-specialist legal firms who offer a fixed rate for our online auctions. Alternatively, you have the option to engage your own solicitor to prepare the legal pack.
5 Observing the Bidding Process:
Relax and enjoy the bidding process unfold. Bids increment based on the property's value, and any bid placed within the final 5 minutes extends the auction by an additional five minutes, ensuring a fair opportunity for all interested parties to bid.
6 Upon the auction countdown completion:
For Traditional Online Auctions, meeting or surpassing the reserve price obligates the highest bidder to buy the property. A holding deposit is then automatically deducted from the buyer's account, secured under a holding deposit agreement, to guarantee transaction progression.
The transaction is finalised online instantly when the countdown ends, and a sale memorandum is produced to confirm the exchange. Unless you opt to personally sign it, the auctioneer will do so on your behalf, formalising the sale.
It's important to note that a successful bid binds you to sell the property at the stated purchase price.
For Conditional Online Auctions, reaching or exceeding the reserve price initiates an exclusivity period for the property. The winning bidder must legally commit to the property exchange within 20 working days post-auction. A reservation fee is automatically charged to the buyer, payable to the auctioneer/agent responsible for the auction and sale facilitation. The auctioneer is empowered to sign the reservation agreement for both the seller and buyer.
Should you fail to complete the exchange within the 20-day period due to your actions, the reservation fee is refunded to the buyer, and you may incur a service fee payable to the auctioneer. Review your agreement terms before listing. Conversely, if the buyer does not exchange within the allotted time, they lose the entire holding deposit.