Buyers commission and modern method of auction

[Alexalee]

Why do sellers use these... makes me not want to even look at their house and must cost them more money in the long run

It sounds so confusing doesn't it? And more expensive as I understand you pay a buying fee too

The ones I have come across are 2.5% buyers commission including vat... so 7.5k on 300k... so I as I assume everyone would just reduced my maximum offer by that amount.

The modern auction I much more disturbing... up to 5% paid upfront then 28 days to exchange... if either you or the buyer pulls out you lose that money... so 15k... a dodgy seller and agent could rinse a few people and make a killing

I think this is entirely an EA device - the problem with a sale at a conventional auction is that there are some upfront costs for the seller and there is no guarantee you will get what you want/need for it if you are selling. Plus the auctioneer's commission is typically 2% or higher - a lot of high street estate agencies charge around 1% with a minimum charge level. Sellers desperate to get their money out may be put off by this.

How many people looking to buy a house to live in actually have the deposit monies upfront and can complete within 28 days? Not every house in an auction is a bargain doer upper that appeals to a developer or investor and a normal auction might not be the right place to sell some properties.

This modern auction malarkey puts all the costs at the buyer's door - the initial reservation fee is in effect an option to purchase - then there are 28 days to exchange and 28 further days to complete. as far as I can see it is usually designed to somehow make houses that won't shift in the market seem more attractive and the EAs get a fee before the sale is concluded, which if the house has been hanging around on their books unsold for a time can only be attractive to the agent.

My ex was thinking of selling this way. It is simple and quick. He expected to sell for lower than he would by the usual method but there is a degree of certainty. (He may still do it as he has been pissed about by buyers who have lied about their position and has wasted best part of a year - there is a good chance they' or he will still pull out)

I'd do it. Buy or sell.

Just got to find a buyer stupid enough to buy this way... offers zero protection or benefit to buyer