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.
‘A particular source of confusion is the Modern Method of Auction….’ The only thing that MMA has in common with traditional auctions is the word ‘auction.’ How this has been allowed to go on so long is a complete mystery. It should be outlawed immediately.
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It is good to see TPOS at last doing something about this issue.
Auctioneering used to be the gold standard of the property profession. With the advent of online auctioneering, unqualified practitioners and private equity have entered the industry and many use every trick in the book to get a sale and maximise income. The Modern Method in particular is a problem.
1. It is common for sellers not to be able to exchange contracts within the 28 day reservation period. The auctioneer will say that it is only the buyer who is obliged to exchange within that period although Contract Law clearly states that the terms in a contract should be fairly weighted. Many buyers have to withdraw because of time factors and lose their fees.
2. The average reservation fee on the Modern Method is now around £8,000 and often much higher. This fee is shared by the “auctioneer” with their ordinary estate agent partner who carries out most of the marketing. The seller sees none of it and the buyer has it added to the purchase price for stamp duty purposes.
3. Legal packs are often poorly prepared and by lawyers who have a connection with the auctioneer. Material information is often added at the last minute, sometimes within 12 hours of an auction and sometimes important information is added at the last minute in the hope that a buyer will not notice it in time for the auction. This is legal but very bad practice.
4. Where the seller is charged little or nothing to gain the instruction and the buyer a large reservation fee (or administration fee in the case of a traditional auction), the evidence is clear that the number of buyers is reduced and the amount bidders will pay is less, so the seller receives less for their property than would otherwise be the case. Auctioneers/partner estate agents are bound by the TPOS Code to tell sellers this, but they rarely do.
5. Many of the new breed of auctioneers do not provide accurate sales particulars. The initial marketing information has to comply with material info regs, just as on a private treaty sale. A lot of auctioneers provide sales information with little or misleading information to encourage interest and defend themselves by saying that the legal pack contains everything that matters. This is not a defence and it is causing lots of problems for interested parties with no knowledge of buying at auction who believe that sales particulars and initial marketing have to be accurate now and they act accordingly.
I could go on and on. There is a major tabloid about to expose the auction trade. We need to get auctions back to what they should be – a fast, secure and no nonsense way to buy and sell houses.
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