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Selling a house by auction

  • 19-04-2019 10:50pm
    #1
    Owlet
    Registered Users Posts: 100 ✭✭


    We are selling a house but the buyers have pulled out due to a poor survey - some structural work required. It's all fixable but we dont have the appetite to do the work and need to sell fairly quickly for personal reasons. The house would appeal to first time buyers - it is a small 2 bed red brick house close to Dublin city centre, so of course many of them wouldn't have the cash to fix the place up either.

    The work is estimated to cost 60k (at most) and we are ok with dropping the price - we just want the place to be sold to free up the equity we have in it. It is not our main home.

    Would it be a good option to sell at auction? Can someone explain the process of this? Do you use an auctioneer (or estate agent?) and pay them as well as the auction house? Or do they auction the properties themselves? How many sets of fees do you end up paying to different parties? Do you have to pay fees even if the property doesn't sell?

    If 60k of work is required should we expect to sell at around 90k lower, as a very rough guide?

    Our estate agent doesn't do auctions and I've never met anyone else who has sold at auction so not sure if this is a good idea or not. Any tips much appreciated. Thanks.


Comments

  • #2
    wetlandsboy
    Registered Users, Registered Users 2 Posts: 212 ✭✭wetlandsboy


    Owlet wrote: »
    We are selling a house but the buyers have pulled out due to a poor survey - some structural work required. It's all fixable but we dont have the appetite to do the work and need to sell fairly quickly for personal reasons. The house would appeal to first time buyers - it is a small 2 bed red brick house close to Dublin city centre, so of course many of them wouldn't have the cash to fix the place up either.

    The work is estimated to cost 60k (at most) and we are ok with dropping the price - we just want the place to be sold to free up the equity we have in it. It is not our main home.

    Would it be a good option to sell at auction? Can someone explain the process of this? Do you use an auctioneer (or estate agent?) and pay them as well as the auction house? Or do they auction the properties themselves? How many sets of fees do you end up paying to different parties? Do you have to pay fees even if the property doesn't sell?

    If 60k of work is required should we expect to sell at around 90k lower, as a very rough guide?

    Our estate agent doesn't do auctions and I've never met anyone else who has sold at auction so not sure if this is a good idea or not. Any tips much appreciated. Thanks.

    I sold at auction in Galway city. If memory serves, auctioneer’s fee was 1%, plus advertising (1k). This may vary with location. No sale, no fee for the auctioneer. Off topic, but just one word of advice: there is no legal requirement on the purchaser to close the sale within 1 month (as is normally stated at auction). The purchasers of my house only closed after 3 months. I tied to sue them for breach of contract, but was told by my solicitor that this may not be successful.


  • #3
    Dolbhad
    Registered Users, Registered Users 2 Posts: 782 ✭✭✭Dolbhad


    Also be aware that Banks don’t like lending on properties that are being sold for auction as our mortgage advisor for Ulster Bank said they don’t look kindly on them as properties sold by auction are usually because of legal or structural issues so you’d want to make sure that FTB’s wouldn’t be the target group for the house.

    Also you should check out if legal costs are higher. My understanding is before auction all legal documents need be uploaded and drafted and those who are interested in it would have their solicitor raise pre contract queries with your solicitor. So instead of your solicitor dealing with one purchaser solicitor, they could be dealing with a few potentials which may increase cost.


  • #4
    chicorytip
    Registered Users, Registered Users 2 Posts: 4,161 ✭✭✭chicorytip


    Owlet wrote:
    The work is estimated to cost 60k (at most) and we are ok with dropping the price - we just want the place to be sold to free up the equity we have in it. It is not our main home.

    Owlet wrote:
    Would it be a good option to sell at auction? Can someone explain the process of this? Do you use an auctioneer (or estate agent?) and pay them as well as the auction house? Or do they auction the properties themselves? How many sets of fees do you end up paying to different parties? Do you have to pay fees even if the property doesn't sell?

    wetlandsboy wrote:
    I sold at auction in Galway city. If memory serves, auctioneer’s fee was 1%, plus advertising (1k). This may vary with location. No sale, no fee for the auctioneer. Off topic, but just one word of advice: there is no legal requirement on the purchaser to close the sale within 1 month (as is normally stated at auction). The purchasers of my house only closed after 3 months. I tied to sue them for breach of contract, but was told by my solicitor that this may not be successful.


    60 thousand!! The structural issue you mention must be very serious indeed. Is it related to the foundations? Anybody interested in this property would find it difficult to get a mortgage so your market is going to be cash buyers like builders or landlords. If you have a bid accepted for a property at auction you have entered into a legally binding contract to purchase and must pay a deposit immediately followed by the balance once the exchange of contracts has taken place. If you fail to do so you are in breach of contract and can be sued accordingly by the vendor. Auction houses such as BidX1 or I am Sold work in conjunction with local auctioneer’s who arrange viewings. Advertising is done on both websites. If the sale goes through successfully you pay a fee to the Auction house only.


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