Survey results: property auction awareness needed
In the final results installment, following Viewber’s Attitudes to Property Auctions survey, we tackle the issue of awareness and note that home movers may need more information.
When we questioned the home moving public about attitudes to property auctions, even we were surprised at some of the results. Despite flats and houses being sold as ‘lots’ for decades – and air time given to property auctions thanks to the long running TV shows like Homes Under the Hammer, the general public still seem to be in the dark on many aspects.
Here we share the grey areas we discovered when it comes to property auctions and the general public:
- The Modern Method of Auction remains a mystery
One of Viewber’s open-ended questions asked people if they knew about the Modern Method of Auction. The answers included “I’ve got no idea what that is”, “I don’t know about that” and “never heard of it.”
The Modern Method of auction is considered a hybrid way of selling a property that gives buyers and sellers more time to think about an offer, and more time to complete. Transactions are measured and take weeks to complete, instead of minutes, but are subject to the same level of marketing and competition as if selling on the open market.
To illustrate, a seller using the modern method can set the duration of the auction, which is typically 30 days, allowing potential buyers more time to view a property and secure finance. Once a winning bid is confirmed, buyers purchasing using the modern method of auction have 56 days, rather than the 28 given by a traditional auction house, to complete the purchase.
This extended transaction time does give buyers more time to consider their purchase. Although they are required to pay a non-refundable reservation fee of up to 5% of the property’s value, on top of the purchase price, they can still walk away from the sale after their bid has been accepted as unlike traditional auctions, exchange does not happen on the day, therefore the seller is not immediately legally tied into the sale.
- Buyers think auctions are reserved for a small minority
Almost half of respondents (46.7%) thought property auctions were reserved exclusively for property developers and investors. In fact, any buyer or seller can use a property auction, as long as they meet the terms and conditions set out by the auction house.
- People think you can’t use a mortgage to purchase at auction
44.8% of those who took part in our survey didn’t know it was possible to buy a property at an auction using a mortgage. A mortgage lender will want an auction lot professionally valued before the grant a mortgage agreement in principle, a Viewber will happily meet a mortgage surveyor at any UK property before an auction takes place for, if they need accompanying.
- Many people think exchange happens on another day
If you thought everyone knew contracts were exchanged as soon as the gavel falls, you’d be wrong. Over 36% of respondents didn’t know about the instant, on-the-day exchange.
Viewber’s Attitudes to Property Auctions survey results highlights how auctioneers and agents can help change the perception of property auctions by addressing the misunderstandings and gaps in knowledge. Our survey results show buyers and sellers love the speed at which property auctions operate but even more home movers could be tempted to online and in-the-room auctions if they knew more.
If you are working in the property auction industry and would like to strengthen links with buyers by offering more accompanied viewings and open house events - or would like to use our simple catalogue photo service, contact Viewber today.