August 23, 2025
How Do Property Auctions Work?
Property auctions are a quick way to sell or buy homes, land, or commercial buildings. The typical open-market process can take month and months to even find a good home, but with auctions, buyers compete there and then by placing bids. The highest bidder secures the property (as long as they can meet the reserve price).
In this blog post, we’ll delve deeper into how property auctions work for both sellers and buyers, the benefits, and what to expect if you’re bidding online.
What Is a Property Auction?
The definition of a property auction is simple: a public sale where real estate is sold to the highest bidder.
Auctions can take place in three main ways:
- In person – usually in a room with a live auctioneer
- Online – through a secure platform where bids are placed online
- Hybrid – a combination of both live and online bidding
Properties are often sold at auction because the seller wants a quick sale, the property needs renovation, or it has attracted significant interest. As a buyer, you might also come across property auctions for repossessed properties and probate sales.
Sellers vs Buyers
The auction process is similar for sellers and buyers, but the actual experience can vary depending on whether you’re buying the property or selling it.
- If you’re a seller, your key goal is to sell your property. This involves setting a reserve price, preparing all the required legal documents, and marketing the property.
- If you’re a buyer, your goal is to find a property that matches your needs and secure it at the right price for you. This involves researching properties, reviewing legal packs, and securing the funds you need.
Whether you’re buying or selling a property at auction, you’ll benefit from being prepared. Keep reading for our step-by-steps for both buyers and sellers during property auctions.
Property Auctions for Sellers: Step by Step
Looking to put a property up for auction? Here’s what to expect:
1. Choose an Auctioneer
The first step is to choose an experienced property auction house. They’ll advise on reserve price (the minimum you’re willing to accept), guide pricing, and market your property.
💡 Tip – This is something we can help with here at Liam Gretton. We can help you professionally market your property and manage all the enquiries and listings throughout the process.
2. Set a Reserve and Guide Price
Next, determine the reserve price and the guide price. Here’s what each means:
- Reserve price – The minimum sale price agreed between you and the auctioneer.
- Guide price – The price you advertise the property at to attract bidders. This is usually slightly lower than the reserve.
Read our guide on how to find out the value of your home for some more insight.
3. Prepare the Legal Pack
This step involves liaising with your solicitor, who will prepare documents like title deeds, property searches, special conditions of sale, and an Energy Performance Certificate (EPC).
4. Marketing the Property
When the legal documents are prepared, you can begin advertising your property. You can advertise on the auction house’s website, on property portals, and on other marketing channels to attract as many bidders as you can.
5. The Auction Day
Now it’s time for the auction day! This is what it’s all been leading up to. Bidders will begin competing live, either in person or online. When the auctioneer bangs the hammer, the winning bidder signs the contract and pays a deposit. The deposit is usually around 10% of the purchase price.
6. Completion
Finally, the completion process begins. This usually happens within one month of the auction (sometimes less), when the remaining balance is paid.
➤ Learn more in our guide on How to Sell Property at Auction
Property Auctions for Buyers: Step by Step
As we’ve established, the auction experience is slightly different when buying a property compared to selling one. Here’s what you can expect as a buyer:
1. Look for Available Properties
The first step is simple – look through auction catalogues and property listings. We recommend viewing the property in person if you can; this will give you a much better idea of whether it’s a good fit for you or not.
2. Review the Legal Pack
Next, review and check all legal documents with a solicitor before you make any bids. This will help you avoid any unpleasant surprises. For example, if you don’t check with a solicitor, you could end up having trouble with it being leasehold over freehold, or you could discover hidden costs and restrictions after the sale.
3. Sort Your Finances
You’ll need your deposit ready (deposits are usually around 10% on the day) and funds for completion within 28 days. If you’re paying for the property with a mortgage, make sure that you have a decision in principle prepared (and in date!) before you bid.
4. Register to Bid
Before you place any bids, you’ll need to register with the auction house. This usually involves completing a registration form, providing proof of identity (such as a passport or driving licence), and showing proof of funds (usually bank statements).
5. Bidding
On to the exciting part! When you’ve found a property you love, you can begin placing bids. You can do this in person (by raising your hand or paddle) or online (by placing digital bids in real time). You may also bid by proxy, by appointing a representative to bid on your behalf (up to a pre-defined limit). The highest bidder wins, as long as the reserve price has been met.
6. Pay the Deposit and Fees
Immediately after winning, you’ll pay the deposit and any buyer’s premium charged by the auctioneer. This payment is non-refundable, so make sure that you are certain before you bid.
➤ Learn more in our guide on How to Purchase Auction Property
How Do Online Property Auctions Work?
Online auctions are becoming more popular, especially among younger buyers – in fact, digital platforms are preferred among 90% of Gen Z buyers when buying properties.
Property auctions that take place online follow the same principles as live ones, but bids are placed via a secure website. Bidding windows usually last a set period (for example, 24 hours to 7 days). When the time runs out, the highest valid bid above the reserve price wins.
Online auctions can be more convenient, but buyers will still need to prepare legal checks and funds in advance.
For sellers, online property auctions follow pretty much the same process as traditional in-room auctions. However, they’re more flexible for all involved and can generally reach a much wider audience.
How Much Do Property Auctions Cost?
Costs vary depending on the property, the legalities, and the auctioneer.
As a seller, you can expect to pay:
- Entry fee – around £200 to over £500
- Commission – usually around 1.5%–3% + VAT of the sale price. For example, on a £200,000 property, this could be anything from £3,000 to £6,000
- Legal fees – can cost anything from £300 to over £700
- Marketing costs – This may be included in the entry fee, but if not, it can cost upwards of £200.
As a buyer, some associated costs include:
- Buyer’s premium – a fixed fee or percentage set by the auctioneer
- Solicitor fees – can cost upwards of £500
- Stamp Duty Land Tax (SDLT) – depends on thresholds – for a £250,000 property, you may be required to pay £2,500 in SDLT
- Deposit – usually 10% of the purchase price, paid on the day of the auction
- Survey costs – If you opt for a survey before bidding, expect costs between £300–£700
Ready to Auction Your Property?
If you’re considering selling your property at auction, you’re in the right place. At Liam Gretton, we can guide you through the process from start to finish. Enquire today to get started.
Property Auction FAQs
Here are some answers to common questions we get here at Liam Gretton. If your question isn’t listed below, contact us and we’ll get back to you as soon as possible.
How long do property auctions take?
The actual auction event can take just minutes per property. However, the process from marketing to completion can typically take around 6–8 weeks. This is still much quicker than the typical property selling timeline, which can take anything from 8 to 12 weeks.
Do you need a solicitor to auction a house?
Yes, you need a solicitor whether you’re auctioning a house or selling it the traditional way. If you’re selling a property via auction, you will need a solicitor to prepare the legal pack. If you’re a buyer, you should have one review the documents before bidding. Conveyancers protect both parties from legal or financial surprises.
Can you get a mortgage on an auction property?
Yes, but it’s not always easy due to time restraints. You’ll need a mortgage agreed in principle before the auction, and you must be ready to complete within 28 days. Bridging loans may be an easier option if the mortgage approval process takes too long.
What if my property doesn’t sell at auction?
If bidding doesn’t reach the reserve price, the property may be withdrawn. However, the auctioneer can negotiate with interested buyers immediately after the auction. This often leads to a sale shortly after.
Liam is the founder of Liam Gretton – Wirral Estate Agent and has a vast experience in both buying and selling homes on the Wirral. His expertise has led him to become one of the Wirral’s leading estate agents.
