You say, "here's no guarantee that you'll get this for guide, of course. However, there is a guarantee that the reserve is set at or around the guide price, because that's what the law requires."

Could you be explicit on this law, please. I went to one auction where many lots reached the guide price but then the auctioneer said they had not reached reserve and so were not sold. In some cases they were way over the guide price.

A lot of bidders were getting cheesed off.

What does "around" mean?
Is this law new?

Hi Webranger

Rob has asked me to post this reply on his behalf..

The guide price is exactly what it says – a guide.

If you read the small print carefully in any auction catalogue, it may say “Guide prices are merely the auctioneer’s opinion of what the property is likely to achieve”, or “Guide prices are for guidance only”.

The guide price is mainly a marketing tool, and the regulations state that it must not be misleading, and it certainly must not be below the reserve.

That last phrase is the most pertinent to your experience - if the bidding hits the guide price without it hitting the reserve, then that means the guide price was set below the reserve.

My understanding of the regulations under which all auctions are run is that this is an illegal practice. I'll check into this further and come back to you, but this was certainly the case when we last wrote Property Auction Secrets.

Cheers

Thanks for the fast and lucid reply. I look forward to getting chapter and verse of the relevant regulation so that I - and other members - can quote it to auctioneers who are acting illegally.

Obviously if the auction goes well over the guide price no-one is going to complain too much - that is the nature of an auction and the operations of markets as a whole; but a guide below the reserve just seems very sneaky. It can, of course, be a deliberate tactic so that the "successful" bidder can be told afterwards, "The reserve was just £5,000 more than your bid, would you like to up it just that little bit?"

Just £5,000! - You can buy a villa in Bulgaria for that now!