Property auctions account for a small proportion of home sales but generate complaints at more than four times the rate of the wider housing market, according to a new report from The Property Ombudsman (TPO).

The Ombudsman said auction sales represented around 2% of residential transactions but were responsible for 5% of all complaints received in 2025 and 9% of residential sales complaints.

More than 300 auction-related complaints were resolved by TPO during the year, with buyers and prospective buyers accounting for the majority of cases. According to the report, 68% of residential auction complaints were made by buyers rather than sellers.

TPO said many consumers enter the auction process without fully understanding the risks, costs and obligations involved. The report found that information provided to buyers can be complex and difficult to navigate, increasing the likelihood of misunderstandings and disputes.

A particular source of confusion is the Modern Method of Auction, where transactions can appear similar to a traditional estate agency sale but involve different timelines, fees and contractual commitments. TPO said complaints relating to this sales method have increased as its use has grown.

Reservation fees remain one of the most common causes of disputes. The Ombudsman found that some buyers mistakenly believe these fees are refundable if a sale falls through or that they will be deducted from the purchase price. In some cases, misunderstandings stemmed from unclear or insufficiently prominent terms and conditions.

The report also highlights the importance of accurate marketing and clear material information in auction sales, where buyers are often required to make decisions quickly and may face financial consequences earlier in the transaction process than in a conventional sale.

Among the issues identified in complaints were inaccurate property descriptions, incomplete legal packs, unexpected fees and a lack of clarity around the auction process.

Lesley Horton, Chief Property Ombudsman, said: “Property auctions can offer speed, certainty and a defined route to sale. However, they also involve a different level of commitment, pace and risk.

“Our casework shows that complaints can arise where consumers do not clearly understand the process, where key information is not provided at the right time or where businesses rely on information being available rather than ensuring it is understood.

“Buyers must carry out appropriate checks before bidding or reserving a property, but businesses also have a responsibility to communicate fairly, clearly and transparently. The point of financial or legal commitment must be made impossible to miss.”

The Property Ombudsman is calling on auction providers to clearly explain the type of auction being used, when financial and legal commitment begins, what fees are payable and what happens if the sale does not proceed.

The report also recommends that businesses treat reservation fees as a high-risk consumer issue, provide clear written and verbal explanations before taking payment and move from simply making legal packs available to ensuring that key risks are properly highlighted.

For consumers, the Ombudsman advises buyers and sellers to read the relevant guidance before taking part in an auction, ask questions about the process and the property and carry out due diligence before bidding or listing.

TPO will continue to monitor complaints in this area and use its casework to identify emerging risks, support learning across the sector and help improve outcomes for consumers buying and selling property at auction.