Why Do Estate Agents Recommend Modern Auction?

If your estate agent has recommended selling by modern auction, something about it might feel a little off. You're right to pause, and my honest advice is to be very, very sceptical.

I run one of the biggest independent property advice websites in the UK, and I've worked closely with leading auction houses over the last five years. I speak with sellers every week who've had this exact recommendation, so I know how it works behind the scenes.

So, why do estate agents recommend modern auction?

Estate agents recommend modern auction because the auction company pays them around half of the eventual fee for the referral. On many sales, that pays the agent more than selling the home themselves would. Sellers should treat the recommendation as a sales pitch shaped by that incentive, not impartial advice.

That's the short answer. But there's a whole machine behind that recommendation, and once you've seen how it works, you'll be able to judge it for yourself...

If you want to cut right to the chase and find out whether modern auction is actually right for you and your property, I've designed a free 60-second quiz to help with exactly that. You'll get your results straight away.

Hit the button below to get started:

Before we get into why your agent is so keen, let's take 30 seconds on what modern auction actually is...

What is the modern method of auction?

The modern method of auction is a conditional auction, usually run online. The winning buyer isn't legally committed to the purchase. Instead, they pay a large non-refundable reservation fee to secure the property, and the sale then completes over a longer timeframe than a traditional auction.

"Modern" auction sounds like the new, improved version of the auction. That's not really the case though.

In practice, it's an auction with longer deadlines and the legal bindingness removed. The theory is that this lets more buyers take part, including mortgage buyers. So, in theory, you get the benefits of auction, but with a higher eventual selling price than you'd normally expect from one.

That's the idea, at least...

I've compared traditional auction and modern auction properly in a separate guide.

The key mechanic is this: when a buyer wins, they pay a big, non-refundable reservation fee. If they back out, the fee's gone, but there are no other legal consequences for them.

And that fee is the key to everything I'm about to show you.

Related: Modern Method of Auction: The Pros and Cons

So why is your estate agent so keen to sell you into this? Well, let me show you the modern auction machine. It seems to enrich everyone involved, except you, the home seller...

The modern auction machine: the 5 cogs

There are five cogs in this machine, and they fit together neatly:

1. The fee.
   The winning buyer pays a very large reservation fee.
2. The split.
   Around half of that fee goes to your estate agent.
3. The salesforce.
   Sales teams recruit and train agents across the country.
4. The sales pitch.
   Optimistic valuations and big promises get sellers signed up.
5. The contract.
   Long tie-ins hold sellers in place while prices get reduced.

Let's take them one at a time, starting with the fee I just mentioned.

Cog 1: The fee

When a buyer wins at modern auction, they typically pay the auction company around 4.5 to 6% of the sale price, including VAT. That's roughly 3-4x the average UK estate agent's fee of 1 to 1.5%.

On lower value homes, there's usually a minimum fee of around £6,000. (If you've got a £60,000 house, that's a 10% fee.)

So it's got big fees. Now, I genuinely think there's nothing wrong with an expensive service, if it's great and people make an informed decision going in. Hold that thought though, because we'll come back to it.

I've dug into why modern auction fees are so high separately. For now, the important question is where all that money goes. That's cog two: the split.

Cog 2: The split (why your agent wants this)

Here's the thing. You might assume the auction company keeps that whole fee for selling your house. Wrong.

Around half of the buyer's reservation fee goes to your estate agent, just for putting you in touch with the modern auction company. On many sales, that referral pays the agent more than they'd earn selling your home themselves.

This is why they want you to sell at modern auction.

And just to give you an idea of the scale of this:

• Over £170 million.
  By its own announcements, the biggest modern auction company has paid out over £170 million to estate agents over the years, just for pointing sellers its way.
• Over £40 million in 2025 alone.
  The referral money is growing, not shrinking.
• Over 7,000 agent branches.
  That's the number signed up to this one company. There are others too, and national chains are striking similar deals.

When that company's accounts were examined a few years back, more than half of its turnover went straight back out the door to its partner agents.

So something really important to set out here: modern auction has not grown organically, by word of mouth, with sellers flooding to it because it's amazing.

Big difference. So we're starting to see how the machine really works. Next is cog three: the salesforce.

Cog 3: The salesforce

How are so many agents across the country all pointing sellers the same way?

It's because the modern auction companies have sales people touring the country, recruiting estate agent branches and then training their teams. So we're talking about sales people training sales people.

Having seen and heard about these sessions from inside the industry, I can tell you they're not about "how to tell if modern auction is the best option for your customer". The emphasis is far more "how to get them to do modern auction".

Staff are trained to listen for trigger phrases like:

• "I want to sell fast."
• "I'm tired of the process."
• "I'm sick of it falling through."

When they hear those magic words, they're trained, and incentivised, to present modern auction as the answer. Whether it's actually right for you, or even right for your property, is much less of a concern.

But the machine doesn't stop there. Even with a big fee, an incentivised agent and a trained script, none of it works unless a home seller says yes. So why are so many sellers signing up? That's cog four: the sales pitch.

Cog 4: The sales pitch

I've spoken with around a hundred people who've had this pitch, so here's how it works.

Your agent hears your frustration. As trained, they plant the modern auction seed and pass you on to the company for a phone call. And here's what I hear every week, directly from sellers who've had these calls: very optimistic valuations, and very big promises.

This is the pattern I keep seeing:

• Imagine a house on the market at £250,000.
  Three months in, with hardly any viewings, in an area where similar homes are selling.
• There's a good chance the price is the problem.
  Rightmove's data shows homes that sell without a price cut find a buyer in around 36 days. Homes that need a reduction average 127 days.
• Then the modern auction company calls.
  And says something like "I think we'll get you £240,000."

Think about that. A company from a completely different part of the country... is going to put your home into a process most buyers can't take part in... give itself a shorter timeframe... and still get nearly the price your local agent already can't achieve. With the buyer paying a fat fee on top.

And it's like... how?

How are you going to do that?

There's no real answer. It's a "just trust us" kind of response.

Here's the mechanic that explains it: that big talk costs them nothing. If they sell, they might make a five-figure fee. If they fail to sell, they won't give you a penny for the months you've lost. There's no downside for them at all.

So the modern auction business model becomes:

1. Sign them up,
2. Chuck it at the wall,
3. See what sticks.

What I tend to find is that sellers who do lots of research end up feeling very sceptical, because the pitch doesn't add up.

However...

People who are more trusting (which is a great trait in most circumstances...) are the ones who unfortunately get swept into the process.

Now, you might think: fine. If the big promises don't come true, sellers are disappointed, and they just walk away, right? Well... no. That's cog five: the contract.

Cog 5: The contract

Remember who signs up to modern auction: people who want to sell their home fast, with certainty, and who are sick of their sale dragging on.

The thing is, many of these companies use 90 day contracts, often with sole selling rights. I've seen them personally, and you'll find complaints about 90 day modern auction contracts in The Property Ombudsman's files. (More on that below.)

So why does a company promising a quick sale need to lock you in for 90 days? Two reasons:

1. More time to find a buyer.
   Ninety days gives them a ton of runway for a second or third attempt if the first auction fails.
2. More time to grind your price down.
   From that high starting valuation. In most cases, this is the real intention.

It plays out as a series of phone calls: "Look, we're on at £240,000. No one's coming to see it. You'll need to reduce, or it's not going to sell."

If you reduce, you're now heading for tens of thousands of pounds less than you expected when you signed up. If you don't reduce, it's made out to be your fault the property isn't selling, and you sit out the rest of those 90 days.

The person who wanted the fastest sale ends up being the one who can't leave. I've broken down how long modern auction really takes if you want the full timeline.

Put the five cogs together, and the machine explains itself...

So why has modern auction got so popular?

Modern auction has grown on the back of a machine that rewards everyone except the seller: a large buyer-paid fee, around half of which goes to the referring estate agent, a salesforce recruiting those agents, a pitch built on optimistic promises, and a long contract that holds sellers in while the price is reduced.

The results show up in the complaints data. The Property Ombudsman reported in June 2026 that property auctions generate complaints at four times the rate of the wider housing market, with confusing reservation fee terms among the biggest sources of dispute.

Now, in the interest of fairness, I think it's really important to say two things:

• There's nothing wrong with a paid introduction.
  Marketing costs money for every company. An agent helping you find the right path forward, and introducing you to a genuinely great service, and then being paid for it, can be a positive thing.
• There's nothing wrong with an expensive service.
  If it's sold truthfully going in, and it's really good, it's a fair deal...

But that isn't what happens.

And here's what I can tell you personally. We run one of the biggest independent property advice websites in the UK. We could start pushing modern auction tomorrow and make a lot of money from the very same referral fees the agents are earning. But I refuse to do that.

So the real question is whether modern auction is actually a great service. I've written my full, honest verdict in Is Modern Auction Any Good?, looking at the four things sellers care about: speed, certainty, convenience and price.

Which leaves one practical question: what should you actually do right now?

What to do if your estate agent recommends modern auction

Treat a modern auction recommendation as a starting point for your own research, not impartial advice. Ask the agent what they'll be paid for the referral, question the valuation, check the contract length before signing anything, and compare the route against your other options on price, speed, certainty and convenience.

In practice, that means four steps:

1. Ask your agent what they'll be paid.
   An honest agent will tell you straight. But the Property Ombudsman also expects agents to explain that auction buyers will likely reduce their offers to cover the reservation fee.
2. Question the valuation.
   If your home hasn't sold at its current price, ask what evidence supports a promise of nearly the same price through a smaller pool of buyers.
3. Read the contract before you sign.
   Look for sole selling rights and the tie-in period. Ninety days is common, and it's very hard to leave once you're in.
4. Compare your other options properly.
   A well-priced sale with a good estate agent, or a traditional auction, can beat modern auction on every one of the four things that matter. I've compared every route in what is the best way to sell a house.

Top tip: Ask for the auction agreement in advance and read it before any phone call with the auction company. A company that's confident in its service won't need 90 days of sole selling rights to prove it.

If you'd rather skip the homework, there's a faster way to get your answer.

Whatever you decide, don't let anyone rush you. Your agent had a financial reason to plant the idea. Now you've seen the machine behind the recommendation, you can judge it for what it is.

And if you'd like personalised help choosing the right way to sell, my free online quiz asks a series of questions and points you in the right direction. It takes about 60 seconds, and if modern or traditional auction genuinely is the right fit, I can connect you with an auction partner I actually trust.

Thanks for reading, and hit the button below to get started:

Common questions about estate agents and modern auction

1

Why do estate agents recommend modern auction?

Estate agents usually recommend modern auction because the auction company pays them around half the eventual fee for the referral. On many sales that's more than their own selling fee would be. The route can still suit some sellers, but the recommendation is shaped by the agent's incentive, so check it fits your situation.

2

How much do estate agents get paid for a modern auction referral?

Referring agents typically receive around half of the buyer's reservation fee, which is usually 4.5 to 6% of the sale price including VAT, with minimums of around £6,000. The biggest modern auction company has said it paid over £40 million to its partner agents in 2025 alone.

3

Is modern auction free for the seller?

Modern auction is marketed as free because the buyer pays the reservation fee. But in practice, buyers tend to reduce their bids to allow for that fee, so much of the cost comes out of your sale price. The Property Ombudsman expects agents to explain this disadvantage to sellers upfront.

4

How long does a modern auction contract tie you in for?

Many modern auction agreements run for a minimum of 90 days, often with sole selling rights, which stops you selling through anyone else during that time. Always check the tie-in period and the exit terms before signing, especially if a quick sale is the reason you're considering auction.

5

Do I have to use the modern auction company my estate agent recommends?

You're free to choose any selling route and any auction partner, whatever your estate agent suggests. Their recommended company is usually the one paying them a referral fee. If auction genuinely suits your property, it's worth comparing independent auction houses and their terms before committing to anyone.

6

Is the modern method of auction any good?

The modern method of auction rarely works well for most sellers. It has a combination of high buyer fees, a smaller buyer pool, and long tie-in contracts. Whether you favour a quicker sale, or a higher price, other selling options will almost always be a better fit.