What is an online property auction?
Sometimes, selling your property through a traditional in-room auction might not be what’s right for you and your circumstances. That is why we offer our online auctions service, so that you can sell your property fast. There’s no need to be concerned about missing out on the traditional process of bidding in the room- you’ll still maintain the same transparency and certainty of sale that’s offered with a typical auction sale.
If you’re considering selling your property online, they’re two different choices when it comes to the sale itself.
- A traditional online auction is where the exchange of contracts happens immediately at the end of the specified time period (as long as the agreed reserve has been met or exceeded) which then confirms the sale. In many ways, this is very similar to our live auction room – only it’s online!
- A conditional online auction is instead where the successful buyer has 56 days to exchange contracts and complete their purchase. While the process takes slightly longer, this is likely to attract additional buyers as it gives them a little longer to raise their finances for the property.
Regardless of the method of sale, every bidder is required to provide payment details in advance of the bidding as a form of pre-authorisation. This then allows for immediate payment to be made when the auction finishes, which gives a seller confirmation that the property has sold.
How to sell property through an online auction?
Selling your property online is simple, and completely secure. Firstly, it’s time to choose your method of sale. You have the choice of either a traditional online auction or conditional online auction. You’ll also need to agree on a reserve price, which is the minimum amount that you would be willing to sell your property for.
After this, you’ll need the set the length of the auction. This can be anything up to 30 days of the property going online. A longer auction period increases the chance of achieving the maximum amount for the property – however, a shorter time can be chosen if your circumstances require it.
Next, you must produce a legal documents pack – this has to be uploaded prior to the auction beginning. We can recommend our legal partners, or you can instruct your own solicitors if you wish to do so.
Then, it’s time to sit back and watch the bids come in. The bids will be placed in minimum increments according to the property’s value. Any bids that are placed in the final 5 minutes of the auction will extend the timer by a further 15 minutes. This allows everyone a fair chance to bid!
Before you know it, the timer will have reached zero. If you’ve opted for a traditional online auction, the successful bidder will be charged a holding deposit so that the exchange can take place (only if the reserve has been met or exceeded). At this point, you are legally obliged to sell the property for the full purchase price.
If, on the other hand, you’ve chosen a conditional online auction, an exclusivity period will begin for your property, which requires the exchange of contacts and completion within 56 days of the end of the auction – if the reserve has been met or exceeded. The buyer is still automatically charged a reservation fee.
If you (the seller) fail to exchange contracts and complete within 56 days, the reservation fee will be fully refunded to the buyer and you may be liable to pay a fee to the auctioneer for any services rendered during the sale of your property.
If the buyer fails to exchange contracts and complete within 56 days, then they will automatically forfeit the full amount of the holding deposit. You will then be free to relist the property for sale online with us, or to sell the property to a third party.
You can find out more about how to sell your property online, by reading our guide.
If you’re interested in selling your property with SDL Auctions, then register for your free valuation today.