The Modern Method of Auction (MMoA) is increasingly promoted as a faster, more transparent way to buy and sell property. But beneath the surface, this approach can carry significant risks — especially for buyers and sellers who aren’t fully aware of how it works.
What Is the Modern Method of Auction?
Unlike traditional auctions, MMoA allows buyers to bid online over a set period. Once the auction ends, the winning bidder pays a non-refundable reservation fee (often thousands of pounds) and has a fixed time to complete the purchase — usually 28 to 56 days.
It’s marketed as a way to avoid gazumping and speed up the process. But the reality can be very different.
Why Buyers Should Be Cautious
Non-refundable fees: You could lose thousands if your mortgage falls through or if legal issues arise. Limited time to complete: The tight deadlines can be unrealistic, especially for buyers needing finance. Misleading pricing: Guide prices are often set low to attract interest, but final prices can escalate quickly. Pressure to commit: The auction format can create urgency that leads to rushed decisions.
Why Sellers Should Think Twice
High fees: Sellers may be asked to cover marketing or auction costs, which can be substantial. Limited buyer pool: Many buyers are put off by the non-refundable fees and tight timelines. False sense of security: A winning bid doesn’t guarantee completion — and you may lose valuable time if the buyer pulls out.
While the Modern Method of Auction is often pitched as a win-win, it’s not always in the best interest of buyers or sellers. The process can be opaque, expensive, and stressful — especially for those unfamiliar with its pitfalls.
If you’re considering buying or selling through MMoA, speak to an independent adviser first. There may be better, safer ways to achieve your goals.