#231
Recent episodes have demonstrated that the UK property market is currently experiencing significant challenges.
- Properties remaining unsold for months
- Rising costs and reduced buyer activity
- Uncertainty around the renters rights bill
- The Impact of stamp duty changes and Section 24
have all contributed to traditional sales methods becoming sticky or protracted.
One solution is selling at auction. Which is what this episode is all about.
Piotr Rusinek is co-founder of Hammered, UK property auction consultants, and co-author of Before the Hammer Falls: The Insider's Guide to Property Auction Success
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37 Question Due Diligence Checklist / Auction Guide
Our Sponsors: Finnigan McNeill Property Group
The Seven Tips discussed in the episode:
Tip 1: Decide if Auction is Right for You
- The trade-off between speed, certainty, and price
- Who should consider auction sales (motivated by speed and certainty rather than maximizing price)
- Drawbacks vs. using estate agents or cash buying companies
Tip 2: The Right Property Type for Auction
- Auction suitability for distressed properties
- Projects and properties requiring refurb
- Less suitable for owner-occupiers
Tip 3: Selecting the Right Auction House
- Not all auction houses fit all asset types
- Importance of auctioneer’s buyer database / marketing focus
- Risks of choosing wrong auction house
- Benefit of professional guidance (e.g. Hammered)
Tip 4: Creating Buyer Excitement and Showing Value-Add Potential
- Showcase development opportunities (extensions, loft conversions, etc.)
- Photographs, floor plans, CGI
- Subtly indicating potential to let buyers feel they discovered it themselves
Tip 5: Setting a Low Reserve Price
- The importance of a low reserve for driving competition and excitement
- Balancing risk and reward with reserve price strategy
- Reserve price recommendations (~70-75% of market value)
- How emotional bidding can drive prices up beyond trader expectations
Tip 6: Preparing a Bulletproof Legal Pack and Using Auction-Savvy Solicitors
- Comprehensive legal pack
- Auction-savvy solicitors
- Timing legal pack uploads (not too early / too late)
- High-quality property photos / marketing materials
Tip 7: Embracing the Auction Cycle
- Understanding auction cycle
- Interpreting buyer activity, pre-auction offers, and data analytics
- Dealing with properties that don't sell
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