What Happens If A Property Doesn’t Sell At Auction UK
What Happens if a Property Doesn’t Sell at Auction in the UK?
Selling your commercial or residential property at an auction can be one of the most rewarding and exciting methods of finding a new owner for your property. Despite the high success rate of an auction (over 80%), it can happen then one or more property fails to meet the reserve price. In this case, the property will be considered “unsold.” While you might have been ready for this eventuality, what happens next can often feel intimidating.
Understanding why your property didn’t sell
Before moving forward and deciding on a different strategy to sell your property, it is essential to understand why it did not sell. The most common causes of these eventualities are:
A too-high reserve price
Pricing your property too high or wrongly can represent a significant obstacle. Moreover, properties that are always priced slightly lower than their value will attract more interest. In turn, this will become more bid. Ultimately, the property will be sold for much higher than expected.
Missing legal pack
If the legal pack is not ready for the auction day, potential sellers might not fully understand the specifics of the property. This can represent a significant drawback for buyers who are prepared to invest in an advantageous property.
No access to view the property
Independently on price and legal pack, you should always ensure that potential buyers have access to the property. Failing to open it for views can cause them to have doubts about the quality of the property.
Your property didn’t sell: what happens next.
Auctions are the ideal way of selling properties since these are often reasonably priced and allow you to sell for more than expected. If your property has not reached the reserve price, the first thing you should know is that you don’t have to pay for the auction. Then, move onto one of the strategies below.
Continue marketing the property.
After the auction, sellers can continue advertising the properties on boards and platforms like Rightmove, or Zoopla. Many auctioneers decide against this strategy. However, sellers should notice that this technique is often successful. Indeed, it can happen that buyers need a little more time to research and view the house before placing an offer. By continuing advertising it, you might find the perfect buyer in no time.
Participate at a second auction
Participating in a second option can be an excellent idea to re-market your property. This is a strategy seller will use once they have granted access to the property, priced it differently, or acquired the legal pack.
Common Concern: Does a failed auction affect the property’s saleability?
In brief, no, a failed action will not affect the value and price of a property. Indeed, if you decide to sell the property privately through an estate agent, potential buyers are not likely to get to know about the property entering an auction. Moreover, if you have informed the estate agent about the circumstances of the auction, they might be able to explain why it did not reach the reserve price.