Under the hammer

Chelvaton £1,325,000

A detached house on the western outskirts of St Peter Port near to the Kings Leisure Centre and town schools.

The property is very well presented with light traditionally laid out accommodation and would equally make an easily run pied-a-terre or family house. There are approved plans (available on request) for a considerable extension that would provide increase many of the room sizes and add an extra bedroom, 2 bathrooms, mezzanine landing, shower room, utility, TV room, study, breakfast room and garden room/office.

Property details

Sitting room, dining room, kitchen, 3 bedrooms ( bedroom 1 en suite), bathroom. Garage, parking and garden.

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Proposed Front Elevation

Proposed Ground Floor

Proposed Rear Elevation Proposed First Floor

Under the hammer

Q&A on property auctions with Cooper Brouard’s licenced auctioneer Trevor Cooper

Simple question to start, what is an auction?

In legal terms a binding agreement for the sale and purchase of something on the fall of the gavel, with no subsequent negotiation or amendment to the pre-published conditions of sale.

And in estate agent terms?

They’re an efficient and transparent way to sell property with the potential of achieving a premium price within a specific timeframe. To some vendors, time can be as crucial as price.

Surely every vendor wants that.

It’s more important than ever in my view. Guernsey’s once efficient conveyancing system is now fraught with delays and protracted negotiations. Often conditions of sale are not finalised until the completion day in court, when the keys are handed over. That’s agonising for vendors.

Cooper Brouard’s recent auction of a derelict local market cottage at Grande Havre for £930,000 made front page headlines. So why are not more Guernsey properties auctioned?

An auction property has to have a wow factor to create mass appeal and ensure active bidding. Leafy Cove at Grande Havre is 50 metres from highwater and looks across a sandy beach. The cottage can be changed whereas its picturesque setting has hardly changed in more than a century.

Surely the recent high levels of activity in both the open and local markets would ensure sufficient demand.

Funding a house purchase is a major factor. Auctions rely on bidders with ready access to a 10% deposit on the day and the remainder of the money available within a matter of weeks, when the conveyance is completed. Guernsey has more than a fair share of independently wealthy buyers but most house hunters need first to sell their current property to fund the next, and they are unlikely to do that in the hope of being the successful bidder at an auction.

Buyers could arrange finance beforehand.

Bridging loans are a thing of the past and mortgage applications prior to an auction incur the hefty cost of an independent survey and legal searches, without any certainty of ultimately purchasing the property. Mortgage applications post auction are not certain of approval which risks the loss of the would-be buyer’s 10% deposit.

And yet television programmes, such as Homes Under the Hammer show nationwide auctions of multiple properties.

Absolutely. Allsop Auctions for example sell approximately 2,000 lots each year across the largest property auction departments in Europe.

So, again, why not in Guernsey?

Other than in exceptional cases the scale of Guernsey’s housing markets and their residential restrictions suit the more conventional method of attracting a wider market over an extended period. Those who would bid at an auction will still make an offer on or even above an asking price if it’s the property they want.

Are there other negatives for vendors choosing to sell by auction?

Not all auctions are successful. A realistic reserve price is typically set beforehand below which the property will not be sold. Cooper Brouard will offer a price range as a guide but the reserve is closely guarded so as not to detract early bidders.

What if the reserve isn’t reached?

The property is withdrawn from the auction, although occasionally the auctioneer is approached on the day to see if a private deal might still be done. Otherwise the property will usually reappear on the market with an asking price in the conventional manner. In any event, it’s ill-advised to try auctioning a property that has already been on the market as bidders will sense a bargain to be had.

Can anyone bid at an auction?

Those who can bid at an auction are no different to those who qualify to buy any Guernsey property, although occupancy laws for open and local market residential units still apply.

How much has the internet changed auctions?

Hugely. Websites and social media provide global marketing options and whereas telephone bidding has long been available for those who could not or chose not to be present at an auction, livestream internet bidding has increased saleroom attendance numbers exponentially.

Presumably these bidders have to register beforehand.

Online and telephone bidders need to provide full personal details consistent with the pre-published conditions of sale, plus their bank account details and due diligence documents. They will almost certainly lodge a four- or five-figure security fee, which is refunded if their bid is unsuccessful and indemnify the vendor and auctioneer against losses, costs and expenses in the event of their non-completion, should their bid be successful.

How do traditional auctions differ from Modern Method Auctions sweeping across the UK?

Modern Method Auctions are held online and timed, which means bidding is open over a period of, say, 28 days. An estate agent (who isn’t always the auctioneer) markets the property and arranges viewings. Home Information Packs provide a range of essential information including a survey, however for reasons of accountability some mortgage lenders insist on buyers commissioning their own survey.

So far, so good…

Not quite. Once bidding closes, the successful bidder is granted a further 28 days to complete the legal formalities and can withdraw from buying the property at any time without reason and have the 10% deposit returned. In effect there is no binding contract to legally enforce the sale, the vendor has merely given the highest bidder an option to buy the property to the exclusion of other potential buyers. This is good news for buyers if the

housing market is red hot like it has been.

Not entirely. The highest bidder also pays the auctioneer a non-refundable reservation fee to secure the property. This can be between 1% and 5% of the agreed price, with a minimum fee of £3,000. This is not deducted from but in addition to the purchase price and Stamp Duty is payable on the combined amount. If the highest bidder withdraws even with good cause the auctioneer retains the reservation fee, unless it’s through the fault of the vendor.

So the vendor doesn’t pay any fees to the auctioneer?

This differs between Modern Method Auctioneers. Some still charge vendors between 1% and 1.5% which is split with the estate agent. The vendor also has to pay for the Home Information Pack regardless of whether or not the property sells, and a cancellation fee to the auctioneer (not to the highest bidder) if the vendor withdraws.

So, you’re not a fan of Modern Method Auctions.

Auctions as we know them have worked well since the Greek Homeric period, pre 1,000 BC. Besides, Modern Method Auctions have been around for 20 years and only became popular during the frenetic market conditions of late.

How long has Cooper Brouard been auctioneering property?

For 21 years, during which time Cooper Brouard has repeatedly held the record for the highest price paid at auction on both local and open markets, and retains record prices paid for commercial property and agricultural land.

There must be some stories to tell over that time.

Stories like snapping my gavel in half in the excitement of a sale, and the time only six people turned up for an auction, and another of a west-coast cottage inherited by 38 cousins and remoter descendants from near and far. Probably best that I save the stories for another time.

Hukeley £1,375,000

A 3 bedroomed family home with easy access to cliff path walks.

A detached 3 bedroom home located on the popular Fort George development with easy access to both lovely cliff path walks and St Peter Port and St Martins village amenities.

A much-loved family home Hukeley is being offered for sale for the first time since it’s construction. The potential purchaser may wish to adapt and upgrade the property as it stands or there is also excellent scope to extend and develop further. Alongside the wellproportioned living space Hukeley provides a double garage, ample parking and south and east facing mature gardens. The site offers a good deal of privacy in a sought-after residential neighbourhood.

Property details

Sitting room, dining room, kitchen, conservatory, bedroom 1 with en suite bathroom, 3 further bedrooms, shower room, separate wc. Double garage, parking and gardens.

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It just, makes it easier

Kitchens | Bathrooms | Bedrooms | Homeware | Tiles Forest Road | Tel: 234000 | mail@cic.gg | cic.gg

Le Pont Renier £2,950,000

A fine detached period house situated on an elevated corner site to the south of St Peter Port.

Le Pont Renier offers much original detail, spacious reception rooms and a recently renovated basement. The latter provides a laundry, store room, shower room and 3 excellent sized rooms that can be adapted to suit your requirements. A super self contained wing attached to the property is ideal for an elderly relative or staff. The south facing terraced gardens are well maintained, there is a detached double garage block, swimming pool, vine house and plenty of parking – an outstanding family home.

Property details

Main House: sitting room, drawing room, dining room, kitchen, study, conservatory, bedroom 1 with en suite shower, bathroom and dressing room. 3/4 further bedrooms (one en suite), bathroom, shower room, 2 separate wc, laundry room, store room, 2 basement rooms. Wing: (Open Market): double bedroom, bathroom, sitting room, dining room, kitchenette. Gardens, double garage, parking, vine house, garden sheds.

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