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Modern Method of Auction


steppensheep

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Does anyone know how these work? They seem to involve low value properties and (as far as I can tell) high participation fees. I think that could effectively make them part auction, part lottery.

Or any info on any online house buying. I'd like to understand how it works in practice.

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13 hours ago, steppensheep said:

Does anyone know how these work? They seem to involve low value properties and (as far as I can tell) high participation fees. I think that could effectively make them part auction, part lottery.

Or any info on any online house buying. I'd like to understand how it works in practice.

Example?

 

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I have seen them more and more lately. They differ from normal auctions where you would normally have to pay a deposit immediately, however a MMOA you only pay a smaller fee (non refundable) and no deposit until exchanging. I believe it's to encourage more people who don't want to put down 10% on a normal auction deposit and then find out the roof needs replacing afterwards.

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Democorruptcy

It's a way of trying to prevent bids lower than the asking price. However I've noticed a few where the price keeps dropping anyway. As the deposit is usually non-returnable I'd be concerned there might be something wrong with it, that might not be obvious. If they do enough auctions and get enough people to lose a deposit, it might pay for the repair.

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There seems to be a mildly useful thread on the other place.

https://www.housepricecrash.co.uk/forum/index.php?/topic/207359-the-modern-method-of-auction-anyone-heard-of-it-before/

Seems like the main beneficiary is for the agent/auctioneer. But it sounds like not a complete scam, and potentially interesting if you want a quick result and willing to accept a bit of a loss.

 

edit: a couple more forum threads. It seems most people don't really like it. I'm beginning to think it's actually more akin to conventional sales transaction, except the period of offers/bidding is limited (although if it doesnt get any interest in can be resubmitted) and it basically creates a lot of incentive for the parties to complete the transaction. So, extra certainty, a little quicker, and big fees for EA.

https://thepropertyhub.net/forum/topic/7877-opinions-on-modern-method-of-auction/

https://forums.moneysavingexpert.com/showthread.php?t=3090250

 

 

22 minutes ago, Democorruptcy said:

It's a way of trying to prevent bids lower than the asking price. However I've noticed a few ....

Do you know any sites where you can watch without registering or anything?  

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Now piggy has mentioned it, Im seeing it in a lot of property listings.

I cant say Id noticed it before, mainly as Id skim and just see 'auction' and its only on places I have absolutely no interest in.

Its a scam.

 

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How to sell a house:

  • If you want lots of money, sell as ONO and wait.
  • If you want money fast, go to auction and get less money.

MMA is the estate agent's invention to get the 'lots of money' and the 'fast' at the same time.  It completely relies on naive buyers that don't understand the two bullet points, above.

[note that bullet point 1 doesn't involve the 'wait' part during a housing boom, hence you don't get MMA then -- it only turns up when volumes are down, ie, when there's a 'wait' for the seller (and agent to receive their cut)]

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22 hours ago, dgul said:

How to sell a house:

  • If you want lots of money, sell as ONO and wait.
  • If you want money fast, go to auction and get less money.

MMA is the estate agent's invention to get the 'lots of money' and the 'fast' at the same time.  It completely relies on naive buyers that don't understand the two bullet points, above.

[note that bullet point 1 doesn't involve the 'wait' part during a housing boom, hence you don't get MMA then -- it only turns up when volumes are down, ie, when there's a 'wait' for the seller (and agent to receive their cut)]

Pretty much.

It also shows how desperate EAs and the property business is for cash.

They need to be lookign for shifts at MaccyDs rather than inventing pointless scams.

 

 

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