Another way of buying property
For most people looking to buy a property here in the UK, the process goes something like this:
- Search online through sites like RightMove or Zoopla
- Contact seller/estate agent when you’ve found a property you’re interested in
- Go and view the property
- If you do like the property, time to put in an offer
- Now it can either go:
- Seller accepts your offer (YIPPEE! 😄)
- Seller accepts another offer (BOOO 😞)
If accepted, all that’s left if to sign the papers, pack up your stuff and move in right? WRONG.
If not accepted unfortunately you could be back to Step 1. The worst thing is if the seller changes their mind and takes the property off the market - that's just time wasted for everyone involved.
This process which is familiar to most buyers is the private treaty way of buying a property. While it is the most used method, it can also be frustrating.
Many see having your offer accepted as almost the end of the journey. Only a few admin hop, skip and jumps away from owning a new property. But in reality, until you exchange contracts, anything can happen. It can take between 14-16 weeks from sale agreed to the exchange of contracts. 4 months is a mighty long time opening for the unexpected to happen. This period of uncertainty also leaves you vulnerable to gazumping*.
*Gazumping is where the buyer makes an offer on a property that the seller accepts but later loses out on the sale as the seller accepts a better offer from another buyer.
What if I told you there is another way?
A way without the risk of gazumping, with fixed time frames and transparency.
And that is the auction method. With auctions, all interested parties have the chance to bid on the property. You will know exactly where you stand in the competition for the property. There are two different method of auction which we go into more detail here
In a nutshell, a traditional auction has exchange occurring at the end of the auction period (when the timer reaches zero on our site). With the conditional auction (modern method), you enter into a reservation agreement giving you 28 days to exchange.
Both auction methods have fixed time frames as the dates for exchange and completion and stated early on. As a buyer there is also no risk of gazumping; the traditional method has a legally binding contract and the modern method has the reservation agreement. If you do lose out on a property, you’ll know that it all boiled down to price and exactly what the winning bid is.
So the next time you think about buying property, think outside the private treaty box, think auctions.