£750,000 House on Modern Method of Auction… and £80,000 in Costs? Understand This Properly

Some buyers come across a property listed via the modern method of auction and question the pricing — particularly when the total cost looks high.

That concern is valid.

But it needs to be broken down properly before any conclusions are made.

Watch This First (Then Read Below)

@john.savage Replying to @Christina Fowler ♬ original sound - John Savage

Start With the Price — Not the Reaction

If a property appears overpriced, the first step is to check:

• What similar properties have actually sold for
• Over the last 6–18 months
• In comparable condition

If evidence supports a lower value, then the concern is justified.

If it doesn’t, the pricing may be correct.

Savage Truth:
Price opinions without sold data are unreliable.

Understand the Method of Sale

Modern method of auction (MMoA) works differently to a standard sale.

Key points:

• The buyer pays a reservation fee (typically ~4–5%)
• This fee is non-refundable
• The seller avoids paying that portion of the agent’s fee
• The structure creates early commitment from the buyer

This is why sellers choose it — it improves certainty.

Why the Price Can Feel Off

MMoA listings often use a guide price.

This is not the expected sale price.

It is used to:

• attract interest
• generate competition

Buyers need to distinguish between:

• the guide price
• the likely market value

Breaking Down the Total Cost

A figure like £80,000 typically includes:

• Stamp duty
• Reservation fee
• Legal costs
• Moving costs

Only the reservation fee is specific to this method.

The rest applies to most purchases.

Where the Confusion Happens

The concern often focuses on the fees.

The more important question is:

Does the overall deal represent fair value once all costs are included?

If the price is already high and fees are added, the deal weakens.

If the value is correct, the structure may still be acceptable.

Mid-Process Check

Based on sold evidence:

What would this property achieve in a standard sale?

Why Sellers Use This Approach

From the seller’s side, MMoA offers:

• Faster progression
• A financially committed buyer
• Lower risk of fall-through

That is the driver behind it.

Practical Approach for Buyers

When assessing a property like this:

1. Confirm true market value using sold data
2. Ignore the guide price initially
3. Calculate total cost, not just the purchase price
4. Decide whether the deal still makes sense

If it does not — do not proceed.

Final Position

Questioning the price is reasonable.

But the conclusion should come from:

• evidence
• structure
• total cost

Not initial reaction.

Need a Clear Breakdown Before You Decide?

👉 Book a 1:1 Strategy Call (£50)

Full breakdown of:

• market value
• total cost
• whether the deal is worth pursuing

Next Step Reading

• 👉 A Similar House Sold for Less — How Much Lower Should You Offer?
• 👉 Downvalued Property: What Happens Next?
• 👉 How to Make an Offer That Actually Gets Accepted