What Happens if a Property Doesn't Sell at Auction (UK)?

Property auctions are increasingly popular Britain.

They are often – but not always – used to sell properties in bad condition.

However, successful sales aren’t guaranteed at auction.

Keep reading this blog to find out what happens if a property doesn’t sell at auction in the UK.

How common is it for a property at auction to not sell?

Estimates online vary, but many converge on aroun 20% of properties at auction failing to sell. So, 1 in 5 people trying to sell their house at auction fail.

Of course, this data could likely be split in other ways, too. For example, what type of properties fail to sell, what price range, etc.

What happens if a property doesn’t sell at auction?

1. The property is withdrawn

When your house fails to sell, the auction company will withdraw it from the listing.

This means that no more offers can be accepted. And it won’t be listed in future auctions until a conversation occurs (see below).

At this point, the auction company may give you their thoughts on why it failed to sell. However, you might not agree with these.

2. Confirmation over whether a payment is due

Your contract with the auction company still needs to be honoured, even when your house doesn’t sell.

Some auction companies demand payment regardless of whether your house sells.

If you’ve signed the contract with this condition, you’ll need to honour it.

3. The buyer decides to relist or go in another direction

Once your house is delisted and the payment is sent (if applicable), the rest is up to the homeowner.

You can decide what to do next.

Is relisting it the best option, at a different price point? And if so, do you want to use the same auction company or a different one?

(Remember, the whole auction process can take between 8 – 12 weeks.)

Cash buyers – a higher certainty alternative

There are several alternatives to auctions. One of these is simply to put your property for sale on the open market.

Another is to sell to a cash buyer. These are also known for being more willing than open-market buyers to purchase property in bad condition.

Cash buyers (like We Buy Any Home) can also buy properties quicker than the open market (or auction houses). And they can guarantee sales.

Reasons a property doesn’t sell at auction

Pricing problem

Pricing is critical when it comes to selling property. No matter its condition, any house will sell at the right price.

No bids came in if your starting number at the auction was too high.

It’s worth getting an expert’s opinion and perhaps asking potential bidders why they weren’t interested if you can.

Legal complications with the house

Properties listed at auction will often have legal complications. This may be why it can’t sell on the open market.

Common examples include:

Sitting tenants who refuse to move out
Extensions made without planning permission.

Another regular legal complication is a dispute over ownership. Or perhaps an ongoing neighbour dispute that’s been taken to court.

Buyers will want to know if they’re taking on this problem. And how it affects house value and their future prospects.

If it does, they may prefer to stay away.

Ineffective marketing

Your auction house will usually offer marketing services. This could be covered by the fee you pay them.

This includes listing your house on their website and marketing materials related to the auction. You may choose to do your own private marketing, as well.

Failure to get interested parties through the door might be due to poor marketing.

Perhaps you’ve positioned your house wrong. Or maybe your auction company didn’t put enough resources into marketing.

This latter scenario could be reflected by other items not selling, too.