16th June 2025

How accurate are guide prices at property auctions?

If you’ve decided that buying or selling a property at auction is for you, but you don’t quite understand how guide prices work, it’s essential to familiarise yourself to avoid any financial surprises. Potential buyers are often keen to understand the accuracy of guide prices at auction, and this involves knowing how guide prices are generated, the factors that influence them, what they signify in relation to the property’s actual value, and how these prices can fluctuate.

Several factors can influence a property’s guide price, these include differing reserve prices, final sold prices, and valuations. This guide explains each of these concepts and offers advice on interpreting them to determine a comfortable bidding price. Keep reading as we break down exactly what a guide price means, how it’s set, and how accurate it really is in today’s competitive property auction market.

What is a guide price at auction?

A guide price is an indicative figure that is provided to help potential buyers decide whether to place a bid. It can be listed as either a single price or a price range, and typically the guide price is used as the starting bid at auction, as this acts as a reflection of the property value at the time of entering the auction, as well as the seller’s minimum expectations.

It’s important to understand that a guide price is not a fixed or guaranteed price. Both the seller and the auctioneer reserve the right to adjust it at any time, depending on buyer interest or market conditions.

In most cases, a guide price is closely linked to a reserve price, which is the lowest amount the seller is willing to accept. This reserve price is kept confidential to the seller and auctioneer and is set within ±10% of the guide price. As a result:

• Bidding may start below the guide price, but if it doesn’t meet the reserve price, the property won’t be sold.

• If interest is strong, the final sale price can exceed the guide price significantly.

In many cases, guide prices are deliberately set below market value to encourage competitive bidding and attract more potential buyers.

How is a guide price determined at property auctions?

A guide price is determined by several factors, including property details, location, and market conditions. It’s intended to attract interest while reflecting the seller’s minimum reserve price. Key influencing factors include:

• Property features: The size, layout, number of rooms, and overall condition.
• Construction details: Age of the building, roofing type, materials used, and energy efficiency.
• Improvements and modifications: Renovations or extensions completed by previous owners.
• Location: Proximity to transport links, schools, amenities, and general desirability of the area.
• Comparable recent sales: Prices achieved by similar properties in the same area within the last three to six months.
• Current market conditions: Demand, buyer confidence, interest rates, and overall housing trends at the time of listing.

Regulatory guidance from the ASA

Since 2014, the Advertising Standards Authority (ASA) has enforced rules to ensure that guide prices are not misleading. These guidelines are particularly important for maintaining transparency and trust in the auction process.

The most important rule is that the guide price must either be a single figure or a price range that is within 10% – above or below – the property’s reserve price. Therefore, it cannot be set significantly below the reserve price just to generate bidding interest.

For example, if a seller’s reserve price is £200,000, the guide price must be no lower than £180,000. This ensures that buyers are not misled into thinking a property may sell far below what the seller is willing to accept.

So, to summarise that point, you could expect to add 10% to the initial guide price in order to meet what the seller has requested, before taking into consideration other bidders driving up the price.

What is a reserve price?

As mentioned, a reserve price is the minimum amount a seller is willing to accept for a property at auction – it is confidential to the seller and the auctioneer. If bidding does not reach the reserve price, the auctioneer is not authorised to sell the property.

While the guide price is publicly listed to attract bidders, the reserve price provides a safety net for the seller. Both can be adjusted before the auction depending on buyer interest and market response, but the reserve price must be finalised prior to the auction starting.

What does “sold price” mean? And why is it important?

The sold price is the final amount a property achieves at auction. This figure does not include any additional fees such as legal costs, stamp duty, survey costs or fees. Understanding sold prices is helpful when doing your research. If you miss out on a property, reviewing the sold price in comparison to its original guide price can show you how much competition there was, whether the guide price was realistic, and trends in pricing for similar properties. Over time, tracking these differences can help buyers better predict what similar properties might actually sell for, beyond just working from the guide price.

So, are auction guide prices accurate?

Guide prices serve as an important starting point in the bidding process. They are designed to generate interest and encourage competitive bidding, ultimately helping sellers achieve a good sale price, often in a relatively short timeframe. For buyers, guide prices offer a reference point, helping them decide whether a property is within their budget, and how high their budget can go. While guide prices are carefully considered for accuracy, they are not guaranteed sale prices. The final sale amount will ultimately depend on bidder interest and demand on the day of the auction.

At SDL Property Auctions, we aim to keep our guide prices as accurate as possible. They are generated using a number of factors closely aligned with the value of the property. It is important to know that on average, auction properties can sell for 15-25% more than the guide price, but they can also sell for less. Therefore, it’s a good idea to consider a 15-25% buffer in your budget if you don’t want to miss out on your chosen property. As mentioned above, guide prices do not include any fees associated with the sale of the property, so you need to ensure that your budget accounts for the required fees.

Whether you’re new to auction or not, it is recommended to do plenty of research in the run-up to the auction event. It’s important to remember that a property will be worth more than the guide price listed and you should be prepared to account for this. We keep our guide prices fair to both the seller and the buyer, and in line with ASA regulations. Prices may be driven higher by other interested parties and ultimately it comes down to what you’re willing to pay after considering associated fees and buffers.

Start researching properties in your area

Exploring upcoming lots in your area is a great way to understand current guide price trends. This can help you gauge what properties are selling for and how best to prepare for your next bidding opportunity. Browse our current and upcoming Auction Events to start your search.