Property auction fees for buyers

If you’re thinking about buying a property by auction and need to set out a budget, ensuring you’re familiar with what buyer fees you’ll pay is essential. That way, you’ll not encounter any unexpected costs or surprises, and you can figure out what your highest bid can be to secure the lot you’re interested in.

In this guide, we’ll take you through each of the fees that you’ll be expected to pay and when you need to pay them. It should be noted however, that these fees don’t follow a one-size-fits-all approach and they vary from property to property. As such, you’ll need to double check the information on the listing to get a more accurate calculation. 

What auction fees do you pay as a buyer?

First things first, you need to establish whether your sale is conditional or unconditional, as each method incurs different fees:

Unconditional sale – This is the more common type of sale, and you will enter legally binding contracts automatically when the gavel falls. You will have 30 days to complete the purchase, unless stated otherwise in the legal pack. In this case, you’ll need to pay a buyer’s fee which may be a set price or percentage of the sale price, and again, this will be stated on the listing. You’ll also be required to pay a deposit of usually either 5% or 10% of the sale price, subject to a minimum of £5,000. There may also be additional fees listed in the special conditions of sale within the legal pack, which the seller has chosen to charge. 

Conditional sale – If you enter a conditional sale, whereby you have a 60 day exclusivity period, you’ll need to pay a reservation fee. This fee can be a set fee or a percentage of the property price, but it will be displayed on the property information. You’ll also need to pay your deposit after the exchange of your contracts. With this method of sale, no fees, apart from the reservation fee, are taken immediately when the gavel falls but they do need to be paid within those 60 days. 

To help give you a better understanding of what charges you might be looking at, the two most common scenarios we see are:

Example 1:

The buyer will pay a 10% deposit (subject to a minimum of £5,000) and a Buyer’s Fee of 1.2% of the purchase price (subject to a minimum of £1,500 inc. VAT).

Example 2: 

The buyer will pay a 5% deposit (subject to a minimum of £5,000) and a Buyer’s Fee of 4.8% of the purchase price (subject to a minimum of £6,000 inc. VAT).

Are there any other auction fees for buyers?

No, there are not any other fees unless this is disclosed in the listing legal pack. The fees you’ll pay are variable on every property, so it’s important to read this pack first. In the description for your property, look for the ‘Auction Deposit and Fees’ heading which will confirm our buyers fees. However, it should be noted that this does not confirm any charges from the seller for that property. 

You usually don’t need to worry about other costs associated with auction, as the seller is responsible for things like the fees for creating a legal pack. But they do have the right to charge back to the seller if they wish to, you can confirm this with our team before you commit to the purchase. Primarily you will just need to focus on setting out your budget, making sure that you have enough left to pay your own solicitors to complete the sale. 

Know exactly what to expect with SDL Property Auctions 

Feel confident when you purchase your property by auction by equipping yourself with the knowledge of our buyer’s fees. This will allow you to adjust your budget accordingly and ensure you’re prepared for the cost, without having to set aside extra money for unexpected financial surprises at auction. 

If you need more information about the process or a specific property you can get in touch with our team to discuss your queries, as our helpful and friendly staff will always do their best to make the experience of buying your property as hassle-free as possible.