UK Property Auction Glossary
Plain-English definitions of every term you'll meet in a UK property auction catalogue or legal pack.
- Guide price
- An indicative figure published by the auctioneer before the sale, usually a range. The reserve price will be set at or within 10% above the top of the guide.
- Reserve price
- The confidential minimum price the seller will accept. If bidding fails to reach the reserve, the lot is unsold (a 'no sale').
- Hammer price
- The winning bid amount, exclusive of buyer's premium, VAT, fees or stamp duty.
- Legal pack
- The bundle of legal documents (title, official copies, searches, special conditions, leases, EPC) published by the seller's solicitor before the auction. Reviewing the legal pack is essential — by bidding you accept everything in it.
- Special conditions of sale
- Additional contract terms set by the seller, often shifting costs (search fees, contribution to seller's legal costs, overage) onto the buyer.
- Vacant possession
- A guarantee that the property will be empty of occupiers and possessions on completion. Lots sold without vacant possession are typically tenanted or occupied by the seller.
- Tenanted lot
- A property sold subject to an existing tenancy. The buyer takes over as landlord and inherits the lease terms.
- Modern method of auction (MMOA)
- A conditional auction format where the winning bidder pays a non-refundable reservation fee and has 28 days to exchange and a further 28 to complete. Often used by online platforms such as iamsold and Bamboo.
- Traditional auction
- Unconditional auction. Contracts exchange when the hammer falls; 10% deposit is payable immediately and completion is typically 20 working days later.
- Unconditional sale
- A sale where contracts exchange the moment the hammer falls — there is no cooling-off period and the buyer is contractually committed.
- Reservation fee
- Payment made by the winning bidder under modern method of auction, in addition to the purchase price, usually 4.5% of the agreed price plus VAT, subject to a minimum (typically £6,000+VAT).
- Restrictive covenant
- An obligation in the title that restricts how the property can be used (e.g. no commercial use, no further building). Some are unenforceable, but assume they are until proven otherwise.
- Overage clause
- A right for the seller (or a previous owner) to receive a share of any future uplift in value, typically triggered by planning consent for development.
- Section 106
- An obligation attached to a planning permission, often requiring affordable housing or financial contributions to local infrastructure.
- EPC
- Energy Performance Certificate. Properties with an EPC of E or worse cannot legally be let on a new tenancy in England & Wales (with limited exemptions).
- Leasehold
- Ownership of a property for a fixed period under a lease, with ground rent and service charges typically payable to the freeholder. Short leases (<80 years) are expensive to extend and can be unmortgageable.
- Ground rent
- An annual payment from leaseholder to freeholder. Escalating ground rents (e.g. doubling every 10 years) can make a flat unmortgageable.
- Auctioneer's addendum
- A supplementary document issued at or shortly before the sale amending the catalogue or legal pack. Always check the addendum before bidding.
- Lotting
- The process by which the auction house assigns a lot number, guide price and order in the catalogue.