Going, going, gone. Just like that

Selling your house at auction is the only way to guarantee a strict timetable for the sale. But not every property is suitable, as Rosalind Russell discovers
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The Independent Online

It's a dramatic flourish well suited to the theatre of the job. The sound of an auctioneer's gavel striking wood is final; a deal done and dusted, no going back. Selling property by auction used to be the route taken only by people with problem properties to unload. Boarded-up, fire-damaged repossessions in inner-city ghettos, redundant Barclays Bank branch offices, or old cottages with outside lavatories and buddleia sprouting from the windows - they were all sad candidates for the property equivalent of the knacker's yard. Increasingly, however, the gavel is coming down on quite upmarket homes, sold by people with no time to linger on the conventional market for a buyer who might lose interest, his job or his own buyer.

It's a dramatic flourish well suited to the theatre of the job. The sound of an auctioneer's gavel striking wood is final; a deal done and dusted, no going back. Selling property by auction used to be the route taken only by people with problem properties to unload. Boarded-up, fire-damaged repossessions in inner-city ghettos, redundant Barclays Bank branch offices, or old cottages with outside lavatories and buddleia sprouting from the windows - they were all sad candidates for the property equivalent of the knacker's yard. Increasingly, however, the gavel is coming down on quite upmarket homes, sold by people with no time to linger on the conventional market for a buyer who might lose interest, his job or his own buyer.

Once the gavel drops, the vendor can look forward to cash in hand within a month - 10 per cent deposit, cheque or banker's draft, is handed over immediately - and life can move on.

There are other advantages. Everyone has to stick to the timetable. The solicitor for the bidder has to do all the work work in advance, so can't abandon the client halfway through and go off on holiday. The buyer's finance has to be in place by auction day, so excuses about funds being held in a 90-day account won't wash. Best of all, no one can renegotiate the price once the gavel comes down. This is bare-knuckle selling, with no price-levering, fancy footwork over bedroom curtains or clapped-out carpets.

"The timescale can be vital," points out Mark Tanton, principal auctioneer with Countrywide Property Auctions. "If you are selling a property in a difficult area, perhaps the home of a relative who has died, you may be worried that it could be vandalised which could affect the price. Selling at auction usually takes only three to four weeks. The market now is quite different from 10 years ago, when it was awash with repossessions. They have dried up and people are more sophisticated, aware that selling at auction is no longer a last resort. It's often the first resort. The variety of property for sale is huge. People are more prepared to take a risk and they are cash-rich. Auctions have never been so well attended."

They don't suit every property, however. What agents describe as "toytown houses" - the average estate family home - will probably get a better price with a local estate agent.

At auction, owners often have to accept a lower price than a local agent might have achieved. Some auctioneers advise a strategy of quoting a fairly low guide price to attract interest, and revising it upwards nearer the auction date if pre-sale offers have been raining in. The actual reserve price is a secret known only to the vendor and the auctioneer. "You'd be amazed at the number of people who ring up before an auction and ask me to tell them the reserve price," says Justin Lowe of Greenslade Taylor Hunt in Somerset. "I never tell them, of course."

The best type of property to sell at auction, says Lowe, is anything that needs renovating, or has development potential (like an old barn), or has the potential for change of use. As this attracts developers with an eye for a profit, amateur bidders find themselves facing professional competition. On the plus side, a developer won't bid beyond his profit margin, so may drop out, leaving a private buyer a clear field. Even a property with a sitting tenant isn't always a liability, as deals can be done, given the right incentive. "You really want to come to auction with a clean history," says Lowe. "It's best to have problems with access sorted out before the sale. People won't bid if there's an unresolved situation with a ransom strip, for instance."

Coming up at the next Greenslade Taylor Hunt auction is the Court House, an imposing Grade II*-listed house near Yeovil, with two reception rooms, five bedrooms, a cottage needing complete renovation, a barn with potential for development, all in 25 acres. The guide price is between £525,000 and £550,000.

Auctioneers' fees vary, but are typically around two per cent, plus VAT, of the sale price. But much depends on the nature of the property and whether it has had pricey national press advertising. FPDSavills also charge a non-refundable buyer's fee of £150, including VAT.

Savills lay out a basic guide for novices in the pre-sale brochure, advising bidders not to wander off and miss the lot number, to bring ID, and to ignore old film clips showing bids made by a nonchalant raised finger or nod of the head: the gesture will be missed in the busy sale room, so make your intention clear by raising an arm and waving the brochure.

FPDSavills's next auction includes an end-of-terrace, two-bedroom cottage in Whetstone, north London, in need of upgrading, with a guide price of £150,000; a semi-detached, unmodernised, two-bedroom house near the centre of St Albans in Hertfordshire with a guide price of just £130,000, and a ground floor, two-bedroom leasehold flat in Paddington, west London, with independent central heating and porterage, at a guide of £250,000. To find your saleroom feet, Savills advise logging on to view a live auction (you can't bid online) at www.eigroup. co.uk (select Online Auction, choose FPDSavills, then viewing gallery).

The Reader's House in Ludlow is being sold at auction on 2 July by estate agents and auctioneers Nock Deighton, because it's difficult to value in the conventional property market. Grade I-listed - only three per cent of listed historic buildings make this group - it dates from the 16th and 17th centuries, but the history of the site can be traced back even further, to 1318. It has been a grammar school (around 1431), overflow premises for guests at the nearby pub, The Bull, an estate agent's office, a private museum and (from 1713), the official residence of the Reader, one of the assistant clergy in the next-door parish church. The last owner, who died last year, lived in it for 30 years.

"It won't appeal to everybody," points out Helen Wall of Nock Deighton. "It has no vehicular access and the Grade I listing means any alterations will be hamstrung by bureaucracy. The local authority and English Heritage will be involved. There has been interest in it from all over the country, judging by the number of people who have looked at the contract papers. But someone who has not contacted us could walk in on the night and buy it." The guide price is in excess of £200,000.

FPDSavills' next auction is on 23 June; 020-7824 9091. Countrywide Property Auctions' next sales are on 10 July in London, 11 July in Birmingham and 16 July in Manchester; 01245 344 133. Greenslade Taylor Hunt's next sale is on 29 July at Sherborne; 01935 423474. Nock Deighton's next sale is on 2 July in Ludlow; 01584 875555.

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