Auction houses have grown in popularity as a way to sell property quickly and with more certainty than traditional sales. Over the last 10 years, the number of homes sold at auction has increased by more than 10%.
But before rushing to put your property under the hammer, it’s good to know the various fees and charges involved, from entry costs and commission to legal fees and marketing expenses. Here’s what you should budget for when selling your house at auction.
Understanding auction fees for sellers
From commission fees to legal pack preparations, here’s an overview of what you’ll pay when selling your property at auction.
Commission fees
Auction houses charge between 2% and 3% of the final sale price plus VAT when your property sells. Some have minimum fees starting from £1,500, which mainly just affects lower-value properties. These commissions may be charged to either the seller or the buyer, depending on the auction house you choose.
Entry or listing fees
Most auction houses charge £300 to £500 plus VAT upfront for catalog listing and marketing. Some offer ‘no sale, no fee’ options to reduce initial costs.
Legal pack preparation
You’ll need a legal pack prepared by a solicitor, which typically starts from £200 depending on the property. The pack contains all documents buyers need to see before bidding.
Additional expenses to consider
Beyond the basic auction commission fees, several other costs might come into play when selling your property at auction. Having a grasp of these upfront will help to avoid surprises and lets you budget properly.
Marketing and advertising fees
Some auction houses charge extra for premium listings, professional photos or featured positions in their catalogs, while others include everything in the commission. Optional extras can cost between £200 and £500 but might help attract more bidders.
Survey costs
While not required, having a survey done can make your property more appealing to buyers. Basic surveys start around £300.
Withdrawal fees
If you pull your property from auction after committing to sell, you might face withdrawal fees that can sometimes be as much as the full commission would have been. Check the auction house’s terms carefully before signing up.
Strategies to mitigate selling costs
When selling at auction, there are a few approaches that can help reduce the total costs. These methods work differently depending on your chosen auction route.
Passing costs to the buyer
Some auction houses let you add clauses to the sale contract that pass certain costs to the buyer. This might include legal fees and searches. While some buyers may bid less if they see these clauses, others won’t be deterred.
Negotiating with auctioneers
Traditional auction houses might reduce their commission for high-value properties or particularly attractive listings. You’ll need to negotiate with the auction house and see if there’s an appetite from their side to reduce their commission.
Auction your property with Property Rescue
At Property Rescue, we’ve partnered with major UK auction houses to offer a uniquely affordable service that has no auction commission fees when you auction through us. You won’t pay entry costs either, and legal fees are only due if the property actually sells. Basically, we make the auction free for you to enter. We’ll do absolutely everything to maximise your chance of selling quickly, and for the highest price possible. Click here to ask us about our auction assistance
Comparing auction costs with traditional estate agent fees
Another way to sell your house involves the more traditional route with an estate agent. It’s worth having an understanding of how the fees compare, so you can make a more informed decision. While auctions often have higher upfront costs, the speed and certainty can make them more cost-effective overall.
Estate agent commission rates
Estate agents typically charge between 1% and 3% plus VAT. Auction houses charge the same.
If you auction through Property Rescue, you pay 0% because the fees are passed to the buyer.
Speed and certainty of sale
While estate agent sales can take months with no guarantee of completion, auctions usually complete within an agreed timeframe of either 28 days or 56 days after the hammer falls. This faster and more predictable timeline can save money on mortgage payments, insurance costs, council tax, and maintenance costs.
Recent trends in property auctions
The property auction market has grown significantly as sellers seek faster, more reliable sales. As a result, the growth has brought new options and innovations to the auction process that make it a more seamless process than before.
Types of properties sold at auction
While auctions work well for renovation projects and unique properties, they now attract all kinds of listings. Property Rescue can auction both residential and commercial properties, in good or bad condition, offering sellers more flexibility in how they reach buyers.
The cost of auctioning your property
We’ve transformed the auction process to work better for sellers. You set your minimum price and keep control throughout, watching bids come in and even closing early if you choose. Our process is fast and secure, with a less than 1% buyer fall-through rate thanks to non-refundable buyer deposits. Whether you’re selling residential, commercial or unique properties, our expert team guides you through every step.
To auction a property get in touch with our team today.