With over 50,000 residential properties offered for sale in 2024, auction sales have morphed from a professional property investor-based way of purchasing to a mainstream alternative to traditional estate agencies. Often certain sellers such as Housing Associations, Charities and Councils only use auctions to sell their stock. 

As the prevalence of auction sales has increased, so too has the use of 'hidden' fees in the legal documents that very often add £000s on to the purchase price. It is all too common to find a 'special conditions' document uploaded to the legal pack, sometimes only a few days prior to the auction day that has a clause demanding that the successful bidder will pay a further fee on top of the winning bid price. This is often hard to spot as it is written in words, not figures but might typically be for 1.5% + Vat of the winning bid. This is often then supplemented by demands for the purchaser to cover the vendor's legal fees, search fees and 'administration' fees. It is designed to obfuscate the sales process and catch purchasers out. Furthermore, many auction houses now typically demand 'processing' or 'admin' fees from the winning bidder of anything from £1000-£2000 on top of the purchase price. Before you know, a winning bidder on a £500,000 lot could find themselves paying well over £12,000 in fees over and above the purchase price they won the bid at.

These fees are not only unfair but underhand. Recent research shows that 30% of purchasers do not study the legal pack before bidding at auction. While we would always strongly suggest that a bidder always studies the legal pack, the hidden fees are designed to push up the total sales price of the property for unsuspecting purchasers. Worse still, some of the worst offenders are charities and housing associations. The rip-off fees should be scrapped as they are not-transparent, underhand, and designed to trick consumers into paying £thousands more than they otherwise would for their property. They are totally unnecessary, unethical and a blight on the reputation of the auction houses that list the properties and the sellers that demand them.

Join SHAFT as we call this practice out and demand an end to hidden auction fees today.