The past year was an undeniably difficult time for the property market, and we’re still feeling the effects of a persistent global pandemic.
However, while house sales were expected to cease during the multiple lockdowns and Covid restrictions, the opposite seemed to be true – especially where property auctions were concerned.
March 2020 saw auction houses adapt to an online model, making property more accessible to buyers and investors who were not deterred by the obstacles put in place by the pandemic.
Heightened demand following the introduction of the stamp duty holiday meant that sellers secured a quicker sale and, in some cases, achieved well beyond their asking price.
The Modern Method of Auction (MMoA) goes a step further, combining the elements of private treaty and traditional auctions – making it a more convenient auction method.
Why sell property at auction?
If you need to sell your property quickly and efficiently then selling at auction could be the ideal choice for you. Not only do auctions have a specific marketing period, but they are also flexible and secure.
As a seller, you can choose the type of sale that best suits your circumstances, set your own timescale and with the buyer either exchanging contracts or paying a reservation fee to secure the property, you know they are committed to the purchase.
Buyers are also recognising the convenience of property auctions. This amplified demand means you have a wider pool of potential purchasers that are likely to enter a bidding war to secure your home – especially as the stamp duty holiday is almost over.
How can MMoA streamline the sales process?
While private treaty is the most common method of property sales, the process can fall victim to gazumping, sealed envelope bids and more – making it an inefficient solution for sellers looking to complete their sale quickly and securely.
More recently, a significant number of estate agents are selling properties under the Modern Method of Auction, a format that gives vendors the opportunity to sell in a transparent, secure and speedy manner.
Upon the acceptance of an offer or at the close of the auction, which usually takes place online, the buyer must place a non-refundable reservation fee to the agents to reserve the property.
The deposit paid can vary from agent to agent and is typically based on a percentage of the final sale price (subject to a minimum amount).
The deposit does not contribute towards the purchase price of the property and 10% of the purchase price will still be required on exchange of contracts, with the balance of the purchase price payable on completion.
Following acceptance of the buyer’s offer and payment of the reservation fee, the buyer is given 56 days to complete. Although the Modern Method of Auction is still a fixed timescale, this allows longer periods for exchange and completion to accommodate the residential buyer and seller over the traditional method of auction.
Buyers also have more time to arrange finances to fulfil the exchange and completion if they are reliant on a mortgage.
If the property falls through due to the seller, the reservation fee will be refunded to the buyer in full. However, if the sale falls through due to the buyer, it is non-refundable.
Case studies – pushing through sales via MMoA
Over 2,000 estate agent branches currently combine their local knowledge and property expertise with iamsold’s award-winning auction service to offer their sellers the Modern Method of Auction.
Here at Oakfield, we have bolstered our services by partnering with iamsold, the pioneers of the Modern Method of Auction and number one auction provider in the UK and Ireland.
The move allows us to provide sellers with access to a wider range of motivated buyers for their properties to achieve a quicker, more secure, sale.
Currently benefitting from our flexible auction service is the seller of a two-bed detached bungalow in Millham Close, Bexhill, who initially experienced a fall through at £400,000 due to a change in the buyers’ circumstances.
The seller decided they wanted a secure sale, and we resold the property under Modern Auction terms for the same price just weeks later.
Elsewhere, on Norman Road, St Leonards-on-Sea, a developer bought a two-bedroom second floor apartment via a method auction for £83,000 and resold it via the same method at £133,000 six months later.
He claimed the service worked well for him when purchasing and wanted the sale to be a smooth, stress-free transaction we he re-sold. As dedicated providers, we were able to make this possible.
From the above, it’s clear that the Modern Method of Auction can guarantee a faster solution for today’s buyers and sellers. Not only does MMoA offer a completion rate of 95%, but the transparent and speedy process can allow both parties to proceed with confidence.
Here at Oakfield Estate Agents, we will do all we can to help you buy or sell your home successfully, offering a complete range of auction services to suit your needs.
For more information on how we can help you to complete your sale in Eastbourne, Hastings and Bexhill, please get in touch with us today.
You can also request a free instant online valuation to see how much your East Sussex property could be worth on the current marketplace.
Don’t miss out on our upcoming sales! View the properties available in our online auctions today.