One of the biggest worries’ clients have when thinking of selling via auction is the idea that they will have to take an extreme financial hit when it comes to the selling price. This is a pre-conceived myth.
Welcome to Connect UK’s Auction Academy – Here to answer all your property auction questions.
Upon a property or land valuation the auction valuer will determine two prices with you. A guide price and a reserve price.
The reserve price determines the lowest price you would be willing to accept for your residential / commercial property or land. This price means that the auctioneer will not accept any offers or bids below this figure.
But how do you determine the right reserve?
Remember, if a property is suitable for auction, expect the sale price to reflect that.
Your reserve will be based on the following 3 points.
- The price you need to achieve. This figure may include any mortgage you have left to pay, moving costs or other reasons you may have for the use of the equity.
- The auctioneer’s valuation. The valuation will determine a guide price in which the property will be marketed at and the valuer will discuss the properties ‘worth.’
- Realism. Remember, private treaty agents’ price differs to auctioneers in that, they will price high to then reduce further along the process. Auctioneers work the opposite. We set an attractive guide price knowing the competitiveness of the auction room and the variety of bidding sources will push up the sale price, organically.
These three points will be discussed through your auction valuation appointment to determine your reserve price.
Check out our other videos on 7 things you don’t know about auctions and help, I’m in financial difficulty.
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