Traditional auctions generally take place at a specified time. This can also be known as ‘unconditional auctions’. They may be held in a physical location therefore you will be buying at auction house, in the true sense of the word. More recently we have seen an increase in a new style of auction, an online house auction. Whilst this method appears more convenient in that you can bid from the comfort of your own home, these auction’s still come with all the strict completion terms of a traditional auction. Exchange of contract usually happens immediately after the buyer has won the bid and completion will be within 14-28 days, although in some cases it can be up to 6 weeks.
With the Modern Method of Auction, buyers bid online like with an online house auction. Once a bid is accepted, the seller and buyer enter an exclusive reservation period. The buyer will pay a reservation fee which is often a percentage of the purchase price. Exchange of contract happens within 28 days of the conveyancer’s receipt of contracts and completion is within 40-56 days. It is important to note that the reservation fee is non-refundable if you withdraw from the purchase, or do not meet the timeframes. The reservation fee is also in addition to the purchase price.
