The main difference between auction and private treaty (selling via an estate agent) is that auction has a fixed timescale for exchange and completion. Auction will usually see exchange occur on the fall of the hammer on the auction date, and completion/key handover typically occurring 28 days later. Private treaty may see a sale agreed quicker, however there is no fixed timescale for exchange or completion, and current reports state that from sale agreed to completion can take on six months on average.
Other differences include the way auction and estate agents approach valuing a property. An estate agent will usually suggest a higher price and seek offers from buyers at or below the asking price. They may, after an initial period, advise the seller to lower the asking price, step by step, until buyer interest is generated. By comparison, an auctioneer will guide a property at a more attractive price which generates interests from multiple buyers; by doing so and using the bid up process in an auction environment, the final selling price for suitable auction lots will be similar to or exceed those achieved via estate agents.
Often the decision to sell by auction is determined by factors associated with the property or the seller’s circumstances. Auction provides speed and certainty; an auction property will usually be sold with an immediate exchange of contracts within 3-6 weeks of it being entered, with completion normally taking place 4 weeks later.