The Modern Method of Auction also sometimes known as a 'Conditional Auction', ensures that contracts are exchanged and completed within a 56-day timeframe from the receipt of the draft contract, with the buyer paying a Reservation Fee. This method broadens the pool of potential buyers by offering more flexibility in the process, allowing additional time for securing financing, which makes it accessible to mortgage buyers.
In a Traditional (or 'Unconditional') auction, contracts are exchanged immediately, with the buyer paying a 10% deposit and a Reservation Fee once the auction concludes. The process allows for a 28-day completion period. While this method is faster than the Modern Method of Auction, it typically attracts only cash and investment buyers due to the quicker turnaround.
While Private Treaty can take over 100 days* to complete, the Modern Method of Auction ensures a completion timeframe of 56 days* from the receipt of draft contracts.
With both parties committed to the sale, the chances of the transaction falling through is greatly reduced, compared with private treaty where over a third of transactions fall through before completion.
All parties are able to submit their offers giving both the sellers and potential buyers full transparency and fairness.