Auctions

Selling and Buying Property by Public Auction

Introduction

Property can be sold either by Private Treaty, Public Auction or by Tender. Private Treaty sales are recognised as the usual traditional method. Sales by Tender are when offers are made usually in a sealed envelope prior to a deadline, perhaps give an impression of "mystery" and very often potential purchasers are deterred because of the nature of the process.

A Public Auction sale is a popular method of sale in order to achieve the best "open market value".

Advantages

  • The whole process, from initial advertising to completion, can be undertaken within 8 to 10 weeks
  • The fall of the hammer, provided the reserve price is reached, is the contract between the seller and buyer
  • The buyer must sign the contract, available for inspection prior to the sale, immediately after the sale - and pay a deposit (usually 10%). The seller's contract is also signed, and the contracts are exchanged
  • The contract will stipulate the completion date when the balance of the purchase money is paid by the buyer
  • If the buyer fails to complete, the seller then retains the deposit - which would cover the sale expenses
  • The seller must be in a position to buy and sign a contract. There is no chain
  • All surveys should be undertaken prior to the sale
  • Open market value is achieved with competitive bidding. With spirited bidding, the realisation price sometimes exceeds expectations
  • If the property does not sell at the auction, it normally remains on the market by private treaty

Auction Procedure

  1. The property generally requires 4-5 weeks' advertising with prominent, effective advertisements. The type of property dictates the publications in which to advertise. Normally, the local newspapers and websites are adequate.
  2. The Sale Contract and Conditions of Sale are made available for inspection by intending purchasers prior to the sale, at the Auctioneers and Solicitor's offices. Your solicitor prepares the Contract.
  3. Prospective buyers must have finance arranged prior to the sale and if necessary a survey on the property. 
  4. The buyer must sign the Contract immediately after the fall of the hammer - and pay a deposit (usually 10%). The deposit is non-refundable and becomes the property of the seller.

The signing of the Contract commits the purchaser to complete the sale on the date fixed for completion. The completion date is when the balance of the purchase money is paid.

Failure to complete can result in penalties. The minimum and usual completion date is 28 days from the date of sale.

Guidelines for Prospective Buyers

Prior to Auction

  1. View the Property
    Arrangement to be made via the Auctioneers, H&H Land & Estates as detailed in the particulars of sale.
  2. Conditions of Sale
    The property is sold subject to Conditions of Sale. Different conditions may apply to separate Lots if there is more than one Lot. The Conditions of Sale are part of the Sale Contract.

It is recommended you familiarise yourself with the Contract and obtain legal advice if you are uncertain on any matter or terminology within the Contract.

  1. Advise Your Solicitor
    Please give a copy of the Auctioneer's sales particulars to your solicitors so that they can begin to make the necessary legal enquiries. Local and other Searches will be supplied with the Contract papers so that these do not need to be carried out by your solicitors but the buyer will be expected to reimburse the cost of these Searches in addition to the purchase price. You will enter a legally binding Contract if you bid is successful at the auction.
  2. Arranging Finance
    Since you will enter into a binding contract at the fall of the hammer and pay a substantial deposit (normally 10% of purchase price), it is essential that all financial arrangements are finalised well in advance. This is particularly important if you need to arrange mortgage finance. If this is the case, it must be arranged well before the auction day. The completion date is in accordance with the Auctioneer's sale brochure, as stipulated in the Contract.
  3. Insurance
    Once a property has been sold and Contracts exchanged, it will become your responsibility for insurance cover. Make sure you have taken out cover from the date of the auction up to the legal completion date. Your solicitors will advise you accordingly.
  4. Sale Prior to Auction
    Please check with us a few days before the sale that the Lot you are interested in purchasing is still available. It may have been sold prior to auction.

Auction Day Arrives...

  1. Arrive Early
    It is best to allow plenty of time before the bidding on your particular lot begins. If possible, meet the Auctioneer and let him know which particular lot you are interested in. 
    (It is possible that there may be some last minute alterations, and these will be announced at the time of the sale.)
  2. Bidding
    Be positive. Signal your bid by definite movements, for instance raising your hand or catalogue. If you have any doubts about bidding then speak to your solicitor who may arrange to do this for you.

When the Auctioneer announces "Going for the first time, going for the second time, going for the third and last time - sold" this is the final stage of the sale process and you must not leave it too late if you want to bid.

  1. Telephone Bids & Nominated Representatives
    Telephone bids to the Auctioneers' Offices prior to the sale cannot be accepted. If you are unable to attend the sale personally, then you must nominate a representative who must have full authority to bid and act on your behalf. The representative must have authority to sign the Contract on your behalf and provide the deposit money.
  2. Success
    If you are successful with the bid, come forward after the sale in order to sign the sale Contract. You will be asked to provide a cheque for 10% of the purchase price, made payable to the seller's solicitors and indicated on the particulars of sale.

Contracts are then exchanged and the seller's signed contract should subsequently be delivered to your solicitor, for them to take further action following the exchange.

Withdrawn Lots
If the property that you are interested in is withdrawn at the sale because it failed to reach its reserve price, please speak to the auctioneer, who will register your interest.

We hope these notes are helpful. If you require clarification on any point, please do not hesitate to contact us.

What Our Customers Say

  • We found Andrew and Kathy to be extremely professional. They guided us through the whole process seamlessly. Cannot recommend H&H highly enough. Thank you.

    Rhona King

    28th February 2019

  • Friendly and professional service at all times. Great service. Tracey is fabulous.

    Saiorse Cosgrove

    10th September 2019

  • Excellent service from valuation through to completion. Very friendly staff and extremely professional. Thank you very much Andrew and Kathy in the Penrith office for your help. Can’t praise them enough.

    J Carver

    13th September 2019

  • Personal, professional and friendly, the team at H&H in Penrith truly give you five star treatment. They help you through all the issues which always arise when buying a property and give you peace of mind that everything is being dealt with. We would definitely recommend this great team and would use again in the future.

    Carol Edmondson

    15th September 2019

  • Thomas, Shirley & Alan, we would like to show you our appreciation for everything you did in the preparation and sale of the (now successful) sale of the farm. Thank you.

    The Hill Family

    1st November 2019

  • From my first dealings with the valuer who came out to look at my property and telephone dealings with the staff in the office, I have had nothing but excellent service and I would like to thank them all for that. My biggest thanks must go to Gillian, who has helped me all the way from start to finish, she has gone beyond my expectations and helped me in every way possible, her enthusiasm and humour along with her professional service has made my experience of selling my property a very pleasant experience and for that I am very grateful.

    J Hill

    21st August 2019

  • Nothing but praise for the service offered by Andrew and Kathy at H&H King, Penrith. They really put themselves out, not only to ensure that we sold our house but also to find us a house that suited our requirements in the right area. We have no doubts that they are worthy of a 5* rating. N&T

    Neil McGeown

    1st October 2019

  • Thank you so much [Mike] for all your help with the Mid-Tier Application. I couldn't have possibly done it myself and it was such a relief to be able to hand it over to you.

    Louise McArthur

    22nd August 2018