Are you thinking about selling your property at auction? In this episode, Ruban Selvanayagam shares expert insights on how to ensure you get the highest price possible.
Ruban breaks down the essentials of auction sales, from choosing the right auction house to creating a strong legal pack that builds trust and confidence with buyers.
You'll also learn how to price your property strategically to spark interest and even bidding wars!
He also uncovers the hidden benefits of auctions, like the security of sale and the potential for better-than-expected outcomes.
Whether you’re new to auctions or looking to sharpen your skills, this episode is packed with practical advice to help you succeed.
Tune in and discover how to master the auction process and maximise your property sale.
Resources Mentioned In This Episode:
>> Ruban Selvanayagam [LinkedIn]
>> Property Auctions News [Website]
Next Steps On Your Wealth Building Journey:
>> Join the WealthBuilders Facebook Community
>> Schedule a 1:1 call with one of our team
>> Become a member of WealthBuilders
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Christian Rodwell (00:02.018)
purpose of Wealth Talk is to educate, inform and hopefully entertain you on the subject of building your wealth. Wealth Builders recommends you should always take independent financial, tax or legal advice before making any decisions around your finances. Today's episode is brought to you by Wealth Builders Membership, a proven step-by-step process that helps you achieve financial security within two to three years. find out more, head to wealthbuilders.co.uk forward slash membership.
Hello and welcome to this week's episode of Wealth Talk. My name is Christian Rodwell, the membership director of Wealth Builders. And you will notice that I am by myself this week as my co-host Kevin Whelan is taking a well-deserved break with his wife in the city of Athens. Now, if you're a regular listener to Wealth Talk, you will know that we teach a holistic approach to building wealth, which looks at different asset classes, including business, investments, pensions, and of course, property.
And today I'm pleased to welcome back Ruben Selvionagam from Property Solvers UK. Ruben was a guest on episode 249 where we were discussing how to maximize returns when buying property at auction. And today Ruben shares how to maximize your returns when selling at auction. And some of the things that you'll learn today will be how to get your property ready to attract the right kind of buyers, which includes pricing competitively and also the importance of working with a good solicitor to
create your legal pack. And remember, a quick sale means that you can keep your money moving and ready to deploy into your next project. So if you'd like to find out more about how Wealthbuilders help business owners and successful employees to create multiple streams of income, then head over to wealthbuilders.co.uk forward slash membership for more information. OK, let's head on over now to my conversation today with Ruben Selvion-Iogam.
Ruben, welcome back to Wealth Talk. Good to have you on again. Thanks for having me, Christian. Appreciate it. No, it's no problem at all. And we had a really good conversation recently on the buyer's side. So how to maximize your returns when buying at auction. And today we're going to be looking at the seller's side. So how you can really maximize the sale of a property at auction. let's get straight into it then, Ruben. What would be
Christian Rodwell (02:19.982)
your advice for someone who's selling a property at auction to maximize their returns. What are the first things they need to think about? I would say you need to think about working with a good auction house. No names mentioned, but really an auction house that is going to maximize the amount of eyeballs that you're going to have in your property. you know, an auction house that obviously works well in the industry for a good amount of time.
has got results that they can show you and also can get your property marketed in the best possible way. So at Property Solvers, we've been running our auction house for four years and we advertise properties not only on the kind of major portals like Rightmove, Zoom, Plur, all the kind of major ones that you kind of tend to kind of recognize as a buyer.
but we also market properties on kind of niche sites, like kind of property buyer sites. We've got our own LinkedIn group. We've got our own database of investors. So we're able to push properties out there into channels that don't normally get the attention. So really what you need to do is kind of make sure that you're not only is your properties kind of, you know, exposed in the right kind of way, but you're also
you know, gets the right kind of reach. So going back to the start of the process, you know, once a client agrees to sell their property with us, we would always make sure that we can get access to the property. So, for example, a lot of moment, a lot of landlords selling through us. What we would often say to them is that we really need to get access to the property and get some good photos, get a good floor plan.
We're doing things like virtual tours now and augmented reality tours and things like that. So it really is a case of us getting into the property using a good photographer to bring out the most of the property so it actually attracts a lot of buyers. Because as I mentioned in the last podcast at the moment, there probably are more sellers than there are buyers. So you really need to stand out.
Christian Rodwell (04:43.692)
And that often means kind of making sure that all the photography and all the marketing materials is put together well. Secondly, I would say that you need to prepare an auction legal pack. as I mentioned in the last podcast, buyers need to be sure of what they're buying. So I know a lot of buyers aren't really that conscious about looking at legal packs, but the diligent ones are going to be.
going through the legal pack with a fine-tooth comb, especially at the moment. having that in place is quite crucial in our opinion. So find a good solicitor. Obviously, if you work with us, we'll be able to put you in touch with the lawyers that we use who can put together a legal packet. It usually takes a few days, but it depends on how much you want to add into it. But get a good legal pack in place so that buyers can actually
understand your property in the best possible way because if you don't provide enough information, it just means that buyers are to be a little bit skeptical about your property and think to themselves, okay, well, I buy this, but maybe I'll owe all the offer. Whereas the more information you can provide them, you're not really giving them any excuses to not bid up to a healthy level, especially if you price it in the right way. If I was selling my house now then, Ruben, what would be the process? If I came to Property Solvers Auction site, I'd need to register.
as a user, as an individual? So the way we would do it is you normally start talking about how quickly you need to sell. So we've got two different types of options. So we've got the traditional unconditional option, which I mentioned in the last podcast, and also we've got what's called the modern method of auction. So that's what I often describe as a cross between the state agency sale and a traditional auction. What you've got is
the for the hammer to fall and then another 28 days to exchange contracts and the further 28 days to complete. So you've got 56 days in total. Now what that means is that the buyer can organise mortgage finance rather than having to rely on cash or bridging in most cases. so it means that things can get, the seller has a few more options and you'll kind of widen the pool of potential buyers, which means that
Christian Rodwell (07:04.942)
you potentially can achieve more for your property as a seller. So we would have a conversation with regards to which of those two options would work better. Often if it's a property in the Midlands that needs a hell of a lot of work, we would probably suggest the 28 day auction. But if you've got a bit more time in your hands and the property's in decent condition, it's empty, and we feel like we could get you a decent buyer, we might say, well, maybe we should put this in our 56 day auction because...
might be able to get you 10, 15 % more than what would be the case with a traditional auction. So we will have a conversation with regards to timeframes initially, but also the price. we have our own due diligence process here in terms of looking at sold comparables, looking at other properties that may have been sold at auction or outside of auction in recent.
probably the last two years is probably where we get our comparables from. And then we're able to kind of see, where should we pitch this property for auction? So price is a really important thing to get right from the start because you need to understand that at auction, people are looking for a bit of a deal. And if you price your property too high, yeah, you might get some people interested, but it's not going to generate the kind of level of interest that you often need.
So we always say to people, let's price this competitively because that's the only way you're to be able to sell your auction. I know there are auctioneers out there that will say, there will probably be a little bit kind of generous with the here, with the purchase price in order to, with the potential sale price in order to win business. But we tend to stick away from that because when we take on a property, we genuinely want to sell it. You know, we don't really want to have to put it back on the market.
and go through a few auction cycles to be able to dispose of it because that's really a disservice to our clients. Also, it tends to take the property to a certain degree. If you put a property up for auction, hasn't found buyers, then a lot of the buyers are going to be thinking to themselves, okay, what's going on here with this property? Is there something wrong with it? How come other people haven't been interested?
Christian Rodwell (09:22.434)
But if you put a property up and then suddenly a bunch of people are all interested, it tends to create that kind of FOMO effect where prices will just kind of go up and up and up because everyone's kind of thinking to themselves, I want this property. And then you see these kind of crazy bidding wars happening. So that's the position that we love to see because the seller's really getting a good result at the end of that. And often, you
Probably not as much in the last couple of years, but we've seen it where for quite a consistent time period, we were seeing kind of sale prices going 15 % above the guide. And that's where we perceive the market value to be. So there were times when we were in a hot market where the prices were just going pretty crazy. And from your perspective as the business owner of the auction house, Ruben,
Do your fees, are they reflected based on the sale price or fixed fees? No, we've got a fixed fee of 1.5 % plus VAT. Yeah, mean, it's not really, I mean, obviously we would earn more for the higher price, it's fairly, you know, it's not a huge amount extra. Our job is really just to kind of get the price at the highest price for the seller, because really they're our client, you know, so.
Yeah, it's more of kind of getting them a good result. And then obviously as an auctioneer, if you're achieving people better prices at auction, it's going to do you a lot of favors in terms of getting more auction business through the door because people think, well, these guys can really maximize what I achieve at auction. So for us, it's more about getting the price as high as we can as part of offering a good service to our seller clients. Now in a traditional sort of
property sale, you'd have an agent and you'd either accept an offer or not. Do you have a reserve when it comes to selling in auctions? Or do you have to take whatever you get offered? No, yeah. We would agree a reserve price with the seller. That's not disclosed to buyers, so it's only between us and the seller. Buyers might try and find out what that is, but we're under no obligation to disclose it and we wouldn't disclose it.
Christian Rodwell (11:46.062)
And really that's kind of really the minimum price that the seller is willing to accept, you know. So we would have that discussion with the seller and just kind of say, look, really, we feel that we can definitely achieve this kind of price for your auction. But obviously we will drive the price up as much as we can. But this is the price that you may need to accept in order to get the sale over the line. And that's where we often have to spend a bit of time with the seller for them to understand that.
We're not trying to rip them off and say, look, we want you to sell at this price because we feel that that's where we would get our commission at the end of the day. We're genuinely pricing it at a level where we feel confident it's actually going to sell. And by and large, it's going to surpass that, but we can never be sure. So we need to come to an agreement with regards to
what that price is going to be before we actually sign any kind of agreement to auction the property. And yeah, that can be a bit of a challenge because we all want to think that our properties are worth more than they are. But sometimes the market just teaches us a lesson. I mean, we've been buying and selling properties ourselves for almost two decades now. And there are times when you think, okay, yeah, I think my property is worth a hundred. You put it on the market and
market it just tells you no it's not you know it's just that's just the way it is you know especially if a property needs work you know or there are other issues with it you need to sometimes just take a bit of a bite of reality and understand that okay sometimes it's not doesn't probably doesn't always go the way you want it to you know that's just the bottom line so sometimes you just got to be a realistic and say to yourself okay well okay i'm going to sell it for this price and
It's a fine balance in trying to educate people to that fact. Another thing to bear in mind is at the moment, we're dealing with a lot of landlord sales and landlords often think to themselves, okay, I'm getting a 6 % yield for this property, but I can still get the open market value for it, the auction. So we have to kind of say to themselves, well, for a start, if you're to sell the property with a tenant inside it,
Christian Rodwell (14:08.43)
going to have problems because the only other buyers that are going to be interested are landlord buyers and their principle is to be looking at the yield. So a 6 % yield in the current market is not really going to work because that's going to only cover your mortgage pretty much. So it's not feasible for people to be buying at that kind of level. And then you've got all the other factors that come into play like rising costs and if the property needs a refurb. So we have to spend quite a bit of time with sellers just kind of saying, look, maybe
you can come back to us in a couple of months once you've vacated the property because then we can open it up a little bit more and find more buyers for it. Perhaps you've got a fixer-upper, a family that wants to move into the property. So we do get those kind of auction buyers as well. It's not just the investors. So we can try and open up the property a little bit further and then maximize the prices they achieve. But sometimes there's these little steps that you need to follow.
before you put your property up for sale, that will maximize the price ultimately. But if you need a quick sale and you've got tenants in there, then you might think to yourself, okay, I'm just going to have to take a bit of a hit on this property because I'm only going to be able to sell it to a landlord who's going to want to look at the yield. So when it comes to selling and maximizing your returns as a seller then, Ruben, all of the work is really up until the point that that bidding begins. Is there anything that can be done after?
hammer drops to increase your returns? Not after the hammer drops because it's kind of the beauty of auctions really because once you've sold the property it's pretty much done and dusted. It's very unlikely for the sale to collapse. Well, would say 1 % likely for the sale to collapse and then if it does collapse as a seller...
you're in quite a strong position because you could potentially keep the deposit that's been paid. You could claim legal fees and the law is on your side, essentially. I I suppose that's a good way to earn some money if the sale does collapse because then you can just re-auction the property and then sell it again, you know. yeah, adding value post exchange is going to be difficult. But the benefit is that you've got security of sale, which you just don't have with
Christian Rodwell (16:29.518)
private treaty until contracts are exchanged, which is usually a couple of days before completion. So once the hammer falls, you can sit back and think to yourself, well, a lot of the hard work has been done in terms of finding a buyer. All the legals are pretty much done because the solicitor probably would have undertaken the auction legal pack. So really it's just like the kind of paperwork that sort of needs to be done. So yeah, most sellers that we deal with are just like happy.
once the hammer has fallen because they know that it's very, very, very unlikely for things to fall free at that point. to recap then, firstly, get your property ready, market it, make it look good, know, usual kind of like position it in its best possible light. Yeah, I mean, what I would say there, Christian, is, you know, with auction properties, if they need a lot of work, you know, you don't have to kind of go crazy and for,
strip down walls and all that kind of thing. Most auction buyers know that the property needs work and they're going to have to do the work themselves. They're fine with that. But if it's just been tenanted and they're like, it's a mess, there's rubbish everywhere, hasn't been cleared out, just hire a man with a van or some skips, clear the place out, make it kind of open enough so people can see the potential. You don't have to go into a full refurbishment mode or anything like that. Just make it well presented.
obviously working with someone like yourself, you'll help with that process just to give some guidance on how to attract the right buyers and the most amount of buyers as well. And then the legal pack, so making sure that all of that is correct and ready to go. Is there anything else in addition that a seller can do to really get the best out the sale price? Really give it enough time on the market.
It depends on the property. With residential properties, for us, we have a three-week marketing period. Sometimes it's less if the seller wants to really move things forward. But I would make sure that you've got enough exposure for a few weeks. Make sure the auctioneer is doing open days and viewings and make sure all the inquiries are being dealt with. I know that is bit of an issue with some estate agents and auctioneers where
Christian Rodwell (18:52.742)
inquiries are happening, but they're not getting dealt with properly. So make sure you're working with a competent and professional auctioneer that is actually going to deal with all these inquiries and make sure that all the questions are being answered. And be at hand to help the auctioneer as well. Because sometimes there might be things that you might be able to point out to the buyer or prospective buyer that the auctioneer has missed. So make sure that you're at hand to deal with any questions that might come through with regards to the property and just...
make sure that everyone is alert with what's going on. And property solvers, do you sell across the UK? We do. Yeah, we do. So we've sold properties in England, Wales, Scotland, residential and commercial land. yeah, we've done all sorts. And if someone listening now, Ruben, would like to contact you, go online, find out a bit more about what you do, where's the best place for them to go?
Yeah, if you Google us at Property Solvers Auctions, you'll find our website. You can put in a quick inquiry there. We've got a phone number there you can call through as well. Yeah, drop us a line. Happy to have a conversation with regards to your selling objectives. We also offer a cash sale option as well. So if you're looking for a super quick sale and you're willing to make a bit of a trade off on the price in return for speed, we can also discuss that option.
Yeah, Google property solvers and property solvers options and yeah, happy to help. And you've got a big community, probably the largest, I think on LinkedIn, right? Yeah, exactly. Exactly. Yeah. I mean, mainly it's there for buyers. So we often use that for marketing purposes. So yeah, but feel free to contact us there as well. Fantastic. Well, thank you once again, Ruben, for sharing everything with us today. It's been really great having you on. It's been a pleasure. Thanks for having me, Christian.
Christian Rodwell (20:42.808)
We hope you enjoy today's episode. Don't forget that we are constantly updating our resources inside the WealthBuilders membership site to help you create, build and protect your wealth. Head over to wealthbuilders.co.uk slash membership right now for free access. That's wealthbuilders.co.uk slash membership.