Side by side
| Factor | Modern method | Traditional |
|---|---|---|
| Binding when? | Buyer signs a reservation agreement, then exchanges within the set period | At the fall of the hammer |
| Exchange and completion | Usually within 56 days of the reservation | Completion commonly 20–28 working days after the auction |
| Who pays the main fee | Buyer pays a reservation fee on top of the price | Seller pays commission; buyer pays a buyer's premium/admin fee |
| Mortgage buyers | Possible, given the longer window | Hard, unless finance is arranged in advance |
| Effect on price | Buyers often bid lower to allow for the reservation fee | Depends on competition in the room |
Figures are typical UK ranges, not quotes. Always check the contract you are offered.
When each one wins
Modern method
- Homes that mortgage buyers would want
- Sellers who want more certainty than a normal sale but no upfront cost
Traditional
- Properties needing work, cash buyers likely
- Sellers who need a binding sale on a known date
Our take
The modern method is often sold as 'free' for the seller. The buyer's reservation fee still comes out of what they are prepared to pay you, so compare the likely net price, not the fee line.
Questions sellers ask
Is the reservation fee refundable?
Normally not. That is what deters buyers from pulling out, and it is why buyers factor it into their bids.
Can I set a reserve price?
Yes, in both formats. The property will not sell below the reserve you agree with the auctioneer.
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