What is a private treaty sale?

What is a sale by private treaty in the UK? 

A private treaty is a sale where the seller and a prospective buyer negotiate the price and terms of a deal directly. 

We act on behalf of sellers by marketing the assets and identifying and approaching interested parties. We give the would-be buyers a guide price, invite them to view the asset and ask them to submit an offer. The seller can then accept, refuse or negotiate. If the seller accepts the offer, the sale is completed when they sign the contract and the buyer makes the payment. 

Residential property is the most common asset type sold by private treaty in the UK. However, it is also common for single commercial assets, including high-value plant, machinery and equipment. 

What is the private treaty sale process?

A private treaty sale could be the best option if you have a commercial asset to sell and a quick sale isn’t your priority. It’s well suited to sellers who want more control over the price and terms of a deal, have assets with unique features or operate in a niche market where demand at auction is likely to be low.

Here is the private treaty sale process:

• You get in touch to discuss an asset

• We appraise the asset and provide a valuation

• We list the asset with a guide price

• We market the asset to our registered buyers and more widely

• We invite prospective buyers to inspect the asset

• Interested buyers submit a bid

• You can accept, reject or negotiate the offer

• Formal contracts are signed and the sale is legally binding 

We strongly recommend that all would-be buyers view assets before making an offer. At Eddisons Asset Auctions, you can contact us using the form on the asset’s listing to arrange a viewing, and all viewings are strictly by appointment only. 

If you want to bid on an asset, you can do so verbally, but you will have to confirm it in writing. We can then present it to the seller. If the seller accepts the bid, we will send you a request for payment. You can collect the asset once the funds have cleared. 

What are the pros and cons of a private treaty sale?

Pros

The advantages of a private treaty sale differ for buyers and sellers. 

For buyers:

• Negotiating directly with the seller without having to compete with other interested parties in a public auction can lead to a better deal

• You can also take more time over the process to make sure the assets meet your specific needs

On the other hand, sellers have:

• More control over the sales process and the price they want to achieve

• Can specify terms and conditions and negotiate the sale in their own time 

• And can keep the details of the sale confidential 

Cons

There are also certain drawbacks associated with private treaty sales. 

For buyers:

• There’s the potential for delays, as there’s no set timeframe for the negotiation process 

• There are also no guarantees of negotiating a mutually acceptable deal

And for sellers:

• There’s uncertainty as an offer is only legally binding once formal contracts are signed

• There’s no guarantee of a sale at the desired price or at all

• The lack of competition can lead to lower prices

Choosing an appropriate sales method for you

Deciding whether a competitive auction or private treaty sale is the right option for your commercial assets depends on the asset’s type and your specific goals and circumstances. If you want more flexibility and control, a private treaty might be a better option, while a competitive auction is better suited to a fast, transparent sale. 

At Eddisons Asset Auctions, we offer a full range of asset sales services and can guide you on the most suitable approach. Find out more about how we can help you sell your assets and get in touch with any questions or to request a free asset appraisal.