A property auctioneer has fought off a complaint that its guide prices are misleading by pointing out that it really has sold a house for £1.
SDL Auctions was one of two auctioneers to face separate complaints, raised by the same person, to the Advertising Standards Authority (ASA). The other was Cottons Chartered Surveyors (Cottons).
In SDL Auctions’ case, the complaint alleged that the guide prices listed in its catalogue were misleading because most of the properties (including lots advertised with a guide price of £1) sold for significantly more.
In Cottons’ case, the complainant claimed that, on average, properties sold for 25% more than the minimum guide price ranges.
Responding to the ASA, CPBigwood Ltd, which trades as SDL Auctions, offered an example of when a house really had sold for just £1.
It said that a recent sale in the north-west of England involved a property that originally had a guide price of £5,000, with a reserve price of £5,000. It failed to attract any interest and because the vendor wanted to ensure a sale, the reserve was reduced to £1 and the guide price adjusted accordingly.
It also pointed out that it explained throughout its literature how it arrived at the guide price and it did not state at any point that the guide price was an indication of the likely sale price, which was completely unknown and could only ever be an educated guess.
Offering a similar defence, Cottons said its auction catalogues contained clear definitions of both its guide and reserve prices, while each property was displayed separately on its website, again with full guide price and reserve price definitions.
It added that while it did its utmost to provide an accurate guide price based on all factors affecting a property and based upon a seller’s genuine minimum price expectation, it could not predict the effect of various factors on the eventual sale price achieved.
Neither case was upheld by the ASA.