Going, Going, Gone

1st April 2006

T. Wyn Jones

Spring is now upon us and although we have not had what you could call a true winter, people are starting to think about a spring clean and time for a change - including changing their home.

So what, I hear you say? If you decide to sell you just place the sale of your property in the hands of an Estate Agent and let them get on with it. Not necessarily so - the usual method of marketing and sale of property in this country is by private treaty. But what of the alternatives? What of auction?

Traditionally the auction method has been used for the sale of farms and agricultural land. It is of course also used in other fields including livestock and antique sales. So why not for the sale of your house, barn or paddock, after all any commodity is only worth what someone is prepared to give for it and what better way to find out than by auction.

So what is the attraction of selling by auction? The beauty is that on the fall of the gavel the property is sold to the final bidder, assuming it reaches its reserve. No “sold subject to contract” where the buyer pulls out at the last moment for whatever reason, change of heart, bad survey etc. On the fall of the gavel the property is sold, the final bidder comes to the rostrum, signs the contract and hands over a cheque for the deposit, there’s no getting out of it!

So if you are contemplating selling a property by auction what do you do? You seek professional advice. Does your agent think that the best method of sale is by auction? In fact, does your agent know the ins & outs of a property auction? And does your agent have the ability to tap into the South East pool of prospective purchasers?

So what of the prices that can be achieved? How about my colleague’s auction of a pony paddock on the edge of a rural village in Mid Wales this last month. A 4.8 acre field located well outside the development limits of the village attracted a full room with two determined bidders refusing to let go. And the sale price £107,000 – over £22,000 per acre.

The figure of £22,000 per acre for pastureland with no development potential can only be described as fantastic. The common misconception amongst the general public that all farmland is worth £2,000 – £4,000 an acre is hopelessly inaccurate, the reality is that the current demand for land is intense and the smaller the acreage the more per acre it will achieve.

So consider auction as a method of sale, it only takes two interested parties and who knows where the price will end up.