Modern method of auction service white-labelled to agents scraps buyers’ fees after criticism

An online auction service which partners with estate agents says it has now scrapped all buyers’ fees.

The move follows criticism by the HomeOwners Alliance last autumn of the “murky” world of the modern method of auction, hitting out at what it called the substantial, non-refundable fees that buyers pay on the fall of the online hammer.

Network Auctions has also introduced a new eBay-style “buy it now” function.

Agents using Network Auctions can now let sellers offer three methods of sale, through either a traditional auction, “buy it now” or “make an offer”.

In all cases, the seller provides a legal pack in advance of the sale.

The “make an offer” option is described as a direct replacement of private treaty.

Before making an offer, a buyer needs to have signed online terms, provided ID and pre-authorised their card for payment of £2,000.

Toby Limbrick, director of Network Auctions, said the pre-authorisation helps a buyer show they are serious and is different to a buyer’s fee as it goes toward the final price rather than being separate.

He said: “By agreeing the terms of business, providing their ID and providing the pre-authorised payment, they demonstrate they are a serious buyer.

“If they do not buy the property that pre-authorisation is removed and the hold on their funds is released.”

Limbrick added: “We launched Network-E in 2016 and since then have successfully rolled this out to our 100 partner agents.

“We saw an opportunity in the market to increase our coverage to allow people to not only bid and buy auction style, but to also ‘make an offer’ and ‘buy it now’.’

“These new buying options allow people the security to buy property but they don’t have to adhere to the strict timeframes of the auction room.

“People are fed up with the amount of time it takes to get a sale through, plus the fall-through rate is high with industry statistics showing almost one in three deals don’t complete.

“With Network-E we have the solution to help people get the property they want to buy – and for agents to get their properties sold. It’s a win-win situation for everybody.

“We took the commercial decision to lower any barriers to entry and so have scrapped all buyers’ fees.”

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2 Comments

  1. Property Pundit

    Let’s see what the response from the likes of Pattinsons and IAmSold will be. Not sure their business model could survive such a move.

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    1. Richard Copus

      Huge step in the right direction by a highly regarded auction group.

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