Modern Method of Auction Explained (+ Pros & Cons)
The Modern Method of Auction (MMoA) is a hybrid way of selling property that blends the open marketing of an estate agency with the urgency and structure of an auction. Unlike traditional auctions, it allows buyers to use mortgages and gives them extra time to complete, while still locking in their commitment through a non-refundable reservation fee. For sellers, it offers speed, competitive bidding, and reduced risk of fall-throughs — but there are fees, timelines, and risks both parties need to understand before diving in.
Key Takeaways:
- A hybrid between private treaty sales and traditional auctions
- Offers speed, transparency, and buyer commitment
- Includes extra costs and risks that sellers and buyers should know about
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- What is the Modern Method of Auction?
- How Does the Modern Method of Auction Work?
- What is the Difference Between the Modern Method & Traditional Auction?
- Pros of the Modern Method of Auction
- Cons of the Modern Method of Auction
- Who is the Modern Method of Auction Best For?
- Modern Auction Not for You? Sell Fast with Housebuyers4u
- Frequently Asked Questions
What is the Modern Method of Auction?
The Modern Method of Auction is a way to sell property through an online bidding process that combines elements of estate agent sales and traditional auctions. Unlike standard auctions, buyers aren’t required to exchange contracts immediately — instead, they pay a non-refundable reservation fee to secure the property, then have 28 days to exchange and another 28 days to complete. This gives buyers time to arrange a mortgage, while giving sellers more certainty that the sale will go through.
How Does the Modern Method of Auction Work?
The modern method of auction works by combining estate agent-style marketing with a timed online bidding process. Here’s how it typically plays out:
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The property is listed with a guide price and a confidential reserve price (the minimum the seller will accept).
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A 28–30 day marketing period begins, with the property listed on portals like Rightmove and Zoopla.
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Buyers place bids online, much like eBay, competing against others in real time.
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When the auction ends, the highest bidder secures the property and pays a non-refundable reservation fee (often 2.5%–5% or a flat amount like £6,000).
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The buyer then has 28 days to exchange contracts, followed by another 28 days to complete the sale.
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If the buyer pulls out, they lose their reservation fee, giving sellers more confidence that the deal will go through.
What is the Difference Between the Modern Method & Traditional Auction?
While both aim to speed up the selling process, the modern method of auction works quite differently from a traditional property auction. Here’s a quick side-by-side comparison:
| Feature | Modern Method | Traditional Auction |
|---|---|---|
| Exchange timeline | 28 days after the auction | Immediate (on the day) |
| Completion time | 56 days total | ~28 days |
| Buyer pays reservation fee? | Yes | No |
| Chain-free buyers needed? | No | Usually yes |
| Mortgage buyers accepted? | Yes | Often no |
Expert advice from our property expert Paul Gibbens:
""We’ve worked with sellers using both traditional and modern auctions, and the key difference always comes down to flexibility. Traditional auctions are great if you're targeting cash buyers and want a quick exchange, but they can put off everyday buyers who need a mortgage. The modern method opens the door to more people — but sellers still need to understand the added costs and longer timeframes involved.
It’s not better or worse, just about picking the method that suits your situation best."
Pros of the Modern Method of Auction
The modern method is growing in popularity, especially among sellers who want more control and fewer fall-throughs. In fact, 2024 saw a 34.3% year-on-year rise in properties sold via auction, with total sales values up 19.1% compared to the previous year.
Here are the main benefits:
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Faster than traditional sales: Properties can be listed immediately without waiting for a live auction event.
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Buyer commitment: The non-refundable reservation fee discourages buyers from pulling out.
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More mortgage-friendly: Buyers have up to 56 days to complete, allowing time to arrange finance.
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Higher visibility: Listings appear on major property portals like Rightmove and Zoopla.
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Set timelines: Fixed deadlines for exchange and completion give both parties more certainty.
Cons of the Modern Method of Auction
While the modern method of auction has clear advantages, there are also important downsides to consider:
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Extra costs for buyers: Reservation fees (typically 2.5–5%) are added on top of the sale price and increase the stamp duty bill.
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Reduced final sale price: Buyers often factor in the reservation fee by bidding lower than market value.
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Not fully binding: Buyers can still pull out after the auction — they lose the fee, but the sale still collapses.
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Not ideal for urgent sales: With 56 days to complete, it’s not suitable for sellers needing to cash out quickly. Cash buyers only are better a better option here.
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Limited buyer pool: Some buyers are deterred by the added costs and unfamiliar process.
Who is the Modern Method of Auction Best For?
This method suits certain sellers and buyers more than others, depending on their goals and timelines:
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Sellers who want more certainty and speed: A good option for those frustrated with fall-throughs in private treaty sales.
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Properties that struggle with estate agents: Homes with niche appeal or issues that deter traditional buyers may perform better in a competitive auction setting.
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Buyers who need mortgage time: Unlike traditional auctions, the extended timeline gives mortgage buyers a fair chance to complete.
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Not ideal for urgent sales: If you need funds in 7–14 days, this method is too slow — a direct cash sale is a better fit.
Modern Auction Not for You? Sell Fast with Housebuyers4u
The modern method of auction offers more certainty than traditional sales, but it’s not always the right fit — especially if you're on a tight timeline or want to avoid fees and drawn-out bidding. At Housebuyers4u, we offer a faster, simpler alternative to auction.
We’ll buy your property directly for cash, no middlemen, no estate agents, and no auction fees. Whether your sale has stalled or you want to avoid the stress, we can complete in as little as 7–14 days, guaranteed.
Find out how much we can Offer for your House
