Selling commercial property at auction
Auctions can be a quick and easy way to sell your property. It is, however, important that you prepare carefully for the auction so that you can make the most out of your investments. If a property is placed in auction but does not sell, you will usually still incur some auctioneers fees. Call us now on 0203 816 9303 for a free, no obligation initial chat with one of our legal advisors, for a bespoke fee estimate and to see how we can help you maximise your chance of success at auction.
Below is a helpful guide to putting your and property in auction:
1. Collate your title information
Most properties are now registered at the Land Registry. We will usually be able to download the necessary information from the Land Registry, but there may be some documents that are unavailable. For example, if your property is occupied by tenants on short term leases and/or tenancy agreements, these will not be held by the Land Registry. You should start to collate your title documents as early as possible. Here at Stephensons we will be happy to talk to you about the property and what documents you will need.
Auction packs are usually made available to prospective buyers online. You will want as many people as possible to consider the pack. Be prepared to instruct the auctioneers and your solicitors as early as possible to prepare the auction pack to ensure it is available for viewing by interested parties as early as possible. We at Stephensons recognise this and will strive to prepare the pack for you as quickly as possible.
3. Title defects
If your property has a title defect that is easily resolvable then you may wish to consider taking steps to resolve it before the auction to increase the saleability of the property. You can also choose not to resolve defects. We will be happy to assist you with this and provide you with advice on the available options.
4. Consider your options
Take steps to consider as early as possible whether or not you wish to impose any covenants or restrictions on the property after it has been sold. This could include overage or a covenant not to do something on the property (such as not to use it as a public house).
5. Will the buyer meet your costs?
A seller does have the option of asking to buyer to pay a contribution towards some or all of the seller’s legal and other costs (such as searches). This is increasingly common.
You should consider carefully what searches are included in the auction pack. As a seller you should try and provide the buyer with a much positive information about the property as possible. Do remember, the cost of searches will be an “up front” fee. If the property does not sell at auction you will be responsible for this cost. Here at Stephensons we will be happy to discuss with you the searches to be included in the auction pack.
7. Replies to standard enquiries
It is important to provide the buyer with as much information about the property as you can, provided that it does not reveal any problems. Whilst for sellers replies to Commercial Property Standard Enquiries can be cumbersome to complete they should always be included in an auction pack where possible.