Telford auctioneers explain why homes exceed guide prices
Anyone who has followed recent property auction results may have noticed something that looks surprising at first glance.
A house is listed with a relatively low guide price. Bidding begins. And by the time the hammer falls, the final sale price is several times higher than the figure people initially saw.
To some observers, this appears confusing or even misleading. In reality, it reflects how auction pricing is designed to work.
James Fielding of Telford House Auctions says the misunderstanding often comes from how guide prices are interpreted.
“A guide price is not a prediction of what a property will sell for,” he explains. “If you start too high, you never find out who your real buyers are. A low guide brings everyone to the table and lets the market decide.”
Unlike traditional open market sales, where prices are tested quietly over weeks or months, auctions put demand on display. Buyers compete openly, bids are visible, and decisions are made in real time. What begins as a low entry point can quickly adjust once genuine interest is revealed.
In the open market, sellers may receive offers privately, often without knowing how many other buyers are interested or how far they might be willing to go. Negotiations happen behind closed doors and momentum can be lost. Auctions reverse that process.
By setting a guide that encourages participation, the seller creates a competitive environment. Buyers are forced to act rather than wait. Hesitation disappears once bidding begins and the price moves quickly to reflect true demand.
Fielding says this is why some auction results appear dramatic when viewed out of context.
“What people are really seeing is price discovery happening in public,” he says. “The value was always there. The auction just allows it to surface.”
This approach can feel counterintuitive to sellers who have been conditioned to believe that starting high offers protection. In practice, ambitious pricing often reduces interest, leading to fewer viewings and eventual price reductions. In contrast, competitive bidding can generate urgency and confidence.
That does not mean auctions are suitable for every property or every seller. Some homes benefit from longer marketing periods. Some sellers prioritise flexibility over speed. Auction is simply one route among many.
However, the idea that auction properties automatically sell cheaply is one of the most persistent myths in property.
Poorly structured auctions can underperform. Well run auctions, by contrast, can expose demand that might otherwise remain hidden.
As more sellers become familiar with how guide prices function, the sight of homes selling well above their starting figure is becoming less surprising. It is not a sign of recklessness or manipulation. It is the market responding when competition is allowed to work.
For more information on property auctions and how they work locally, you can find out more at telfordhouseauctions.com
