High reserve price warning: what have you really got to lose?

By Mark Grantham on 4th August 2026

Six months ago, we highlighted a worrying auction sales tactic: companies telling property owners they could "set their own reserve price".

It sounds reassuring. The seller chooses the minimum price, so what could go wrong?

The problem is that a reserve price is not supposed to be a figure chosen simply because it makes the seller feel comfortable. A good auctioneer should assess the property, examine the evidence and recommend a realistic figure before asking the seller to sign.

Our earlier warning asked whether the promise to "set your own reserve" was really about achieving a successful sale, or simply winning the seller's instruction.

We are now hearing from an increasing number of confused sellers about another variation of the same gimmick.

Quick sale companies suggesting higher auction reserve prices than genuine auctioneers recommend What's the catch?

How sellers are being approached

The seller searches online for help selling a house or flat at auction. A sponsored advert appears from a property buying company, also known as a quick sale company, saying something like:

The seller enquires because they expect the company to buy the property. The company then decides not to make a direct offer and recommends auction after all.

Sellers are often puzzled by that, but there is usually a straightforward commercial reason. A quick sale company only makes its money by purchasing below market value, so an offer to purchase might not be viable if:

• There is not enough equity in the property. A discounted offer would not clear the mortgage and anything else secured on the property, so there would be nothing in it for the seller to accept.
• The property value is too high. Buying companies work to a budget and may not want to tie that much cash up in a single property.
• The property does not fit their buying criteria. Location, property type, tenure or condition can all put a property outside what a particular company buys.

None of those reasons are sinister. What matters is what the company does next.

Instead of referring the seller on to a suitable auctioneer, the company attempts to take control of the sale. The seller may be told there are no fees, the company will take care of every part of the auction sale, and the seller will receive no less than an agreed reserve price.

It is presented as a simple, tidy arrangement. One point of contact, nothing to pay, and a high reserve price the company is confident of achieving. So confident, in fact, that it charges no fees at all, but keeps whatever the property sells for above the reserve.

For example, if the reserve is £200,000 and the property sells for £215,000, the seller receives £200,000 and the quick sale company receives £15,000.

The "quick sale company" auction proposition, and the reaction it is designed to produce:

The answer is: control, time, flexibility and negotiating power.

All the quick sale company really wants is your instruction

In a slow or sluggish property market, agents and property companies may struggle to win enough instructions. Suggesting the highest price is a familiar way to persuade a seller to sign.

One auctioneer might recommend a realistic reserve of £180,000. Another might suggest £190,000. Then a quick sale company says £200,000 will be no problem because it has special marketing, access to unique buyers or a superior way of maximising the price.

That is exactly what the seller wants to hear.

But consider the logic.

A company which keeps everything above the reserve has less potential upside when it suggests a very high reserve. This indicates that the immediate prize may not be a hefty profit above the reserve.

The prize is your instruction and the exclusive right to control the sale.

The high figure is not necessarily a genuine guarantee. It may simply be the figure needed to obtain your signature.

Once the seller signs an exclusivity, sole selling rights or similar agreement, the company no longer needs to compete with other auctioneers or agents. What happens next may largely depend on the contract.

The company might refer the property to an auction provider, test lower offers, wait to see whether the seller becomes more motivated, or later say that the reserve must be reduced.

It might claim that buyer interest is weak, the market has changed or the auction company will not accept the original figure.

Some changes in pricing advice are legitimate. New legal information, surveys and genuine market feedback can affect value.

The warning sign is where the original high reserve was never properly supported and appears to have been used mainly to win the instruction.

This is the classic tactic:

1. Tell the seller what they want to hear
2. Secure control of the property
3. Work the price down

The seller's question: "what have I got to lose?"

You could lose weeks or months.

You could miss the opportunity to instruct a genuine auctioneer directly. You could lose access to other buyers or become liable for withdrawal charges. Your circumstances may change while the company controls the property, making you more willing to consider a lower offer later.

Now retrace your steps. How did you end up here? You went looking for an auction service, were told not to use one, and then the company chose not to buy. It is now recommending an auction run by somebody else, on a reserve higher than a genuine auction company would suggest. Does that journey add up?

Trust your instincts.

The apparent safety of the high reserve is not real if the company has not bought the property, guaranteed the money or accepted any meaningful financial risk.

If they are so confident, make a counter-offer

Remember what has actually happened here. A genuine auctioneer, who sells property for a living and only gets paid when the hammer falls, has looked at the evidence and recommended a sensible reserve price. A quick sale company that has just declined to buy your property has told you it can beat that reserve price. It is a bold claim, and there is no reason to be shy about testing it.

If the quick sale company says its suggested reserve price is readily achievable and its special marketing will produce a sale, ask a simple question:

A genuine buyer puts its own money at risk. It funds the purchase, takes ownership and accepts the possibility that it may not resell the property at a profit.

The quick sale company may have legitimate reasons for not buying. And if it will not put its own money behind the figure, ask yourself why the figure was quoted in the first place. A reserve well above the one an auctioneer has recommended, offered by a company that will not stand behind it, is not a valuation. It is a number that sounds better than the one you have been given elsewhere, and its purpose is to win your instruction.

So test the figure. Then test whether you need the company at all.

Start by asking for the number in writing, with the evidence behind it.

A reserve should be arrived at from evidence: recent sale prices for similar properties in the area, and recent auction results for the same kind of property. Anyone who values property for a living can set that out in a short email, and will expect to be asked. A figure chosen to win an instruction has nothing behind it, so the request tends to be met with delay, or with vague talk about demand and special marketing.

Then get a second opinion before you sign anything.

Speak to two or three auction companies directly and ask each one what reserve it would recommend, and why. Look up what nearby properties actually sold for using the Land Registry price paid data, and look through recent auction catalogues and results for your area. It costs nothing and takes an afternoon.

A quick sale company may also tell you that it will take care of everything for you. Auction is often made to sound complicated, with the quick sale company doing all the hard work on your behalf, and it can seem as though it is adding something to the process.

It is not. Selling at auction directly with an auction company is very simple, and there are plenty of auction services that work on a no sale, no fee basis, with nothing for you to pay upfront. That is not something only a quick sale company can arrange for you, so do not let anyone persuade you otherwise.

Strip that away and only one thing is left: the higher figure. That is the part the company cannot deliver.

Genuine auction is simple and transparent

An auctioneer will not tell a seller what they want to hear about price, just to win their instruction. A good auctioneer will happily turn an instruction away if a realistic reserve price is too low for the seller.

Once a quick sale company sits in the middle, that clarity goes. You sign with one company, a different company runs the auction, and it is no longer obvious who set the reserve, who is accountable for it, or what the arrangement between the two of them is costing you.

RICS defines the reserve as the minimum price at which the auctioneer is authorised by the seller to sell the property. The property can sell to the highest bidder at or above that amount, but the auctioneer is not authorised to sell below it. The RICS property auctions consumer guide sets this out for buyers and sellers.

The reserve is therefore a safety net. It is not supposed to be an invented figure used simply to make an instruction attractive.

The starting point for a successful auction is a realistic reserve.

If the reserve is unrealistic, the property may fail to attract serious buyers and may not sell.

If a company promises a reserve well above the evidence, says a sale will be no problem, refuses to buy the property itself and wants exclusive control while another business carries out the auction, something is not right.

Most importantly:

If an auction company is conducting the sale, sign the auction contract directly with that auction company.

Auction should be simple.

Do not let a quick sale company that is hungry for your instruction turn it into a complicated scheme in which it controls your property, risks very little and decides what happens next.

Further reading

Our full comparison of selling to a property buying company versus auction looks at how these companies operate, how headline offers compare with achievable prices, and why late price reductions are so common. Our earlier article on the "set your own reserve price" promise explains how a reserve should actually be arrived at, and it is also worth understanding the difference between unconditional and conditional auctions before you sign anything.

Next steps

Contact us to find out if your property is suitable for auction. Request a free pre-auction appraisal or feel free to call us on 0800 862 0206 - we'll be happy to help.