The 'Modern Method of Auction'

[cornflakecrunchie]

Do people actually buy houses sold by this method?
That's it.. that's all I wanted to know. It just seems such a rip-off!

I'm also intrigued. I looked at a few houses for sale in this manner and thought I stood to lose a lot of money if it went tits up.

Ordinary people? Who need a mortgage ? I can't imagine so.

Developers / flippers / people looking to cash in on HMOs might

I bought a house this way. No ripoff. Make sure the purchase price is low enough to justify the auction house fees (4.2%) is all. I used bridging finance (12 month mortgage). I wouldn’t recommend trying to buy this way with a regular mortgage

Same. I assume they're unmortgagable as they're really restricting the amount of buyers who will be interested. So many fees to pay and no guarantee that you'll even get the property.

We're mainly thinking the same way then.. thanks all!
(I'm not moving, just wondered how buyers went on with this method!)

Judging but how many modern auction houses I see constantly being relisted on rightmove, not many people do buy them.

Unsuspecting sellers get talked into selling this way by estate agents, who’ll tell them it’s a great idea because the buyer will pay all the fees.

In reality most buyers are put off by the massive non refundable fee, and high risk of losing it, and won’t touch MMOA houses
with a bargepole.

Even if anyone does buy it, they’ll reduce their offer by the amount of the massive fee they have to pay. So sellers will always lose out using this method.

Yes I know people who have but they are investment properties or second homes for cash.

I don’t know about buying but friend was ripped off hugely when she had to sell a house after her dad died. First “sale” dragged on for 9 months , buyer dropped out and the EA ( calling itself a property auction co) refused to tell them what happened to the deposit. She never found out if the EA kept it or buyer was refunded. Had to pay a big conveyancing fee for nothing.
Second buyer dragged it out for months again, someone else wanted to buy and EA threatened to sue my friend for £10k if she sold through anyone else or no agent at all. It took 18 months in total and was very stressful for her.

It’s not a deposit, it’s a non refundable fee that the estate agent keeps even if the sale doesn’t complete.

The T&Cs your friend signed up to would have included a clause that made her liable for the massive fee, if she sold outside the auction process.

Sorry your friend got caught out, but it’s clear why estate agents are so keen to push this method of sale.