Leading Sussex auctioneers, Parsons Son & Basley have put together a useful piece about Auction Guide Prices. If you're new to auctions, or simply just curious about the ins and outs, then the below might be of interest:

P S & B Auctioneer, Simon Caplin, explains the correct meaning of the term.

Having conducted a straw poll recently, it would appear that many people are unaware of the correct meaning of the term ‘Guide Price’. Some of the explanations I received from the poll ranged from “the final selling price” to “the amount the auctioneer expects to sell the property for”.

"The correct explanation is that a guide price is an indication of the seller’s minimum expectation. It is not necessarily the figure at which a property will sell and may change at any time prior to the auction".

"The reserve price is a figure below which the auctioneer cannot sell the property during the auction and should be set within the parameters of the quoted guide. For example, if a property has an advertised guide price of £275,000 to £300,000 then the reserve should be set in between these two amounts, i.e. not below £275,000 and no more than £300,000. With a single figure guide such as £300,000, the reserve should not be set outside a tolerance of 10% which in this case should be £330,000 at the higher amount.

At the auction itself and as is the case on many, many occasions, a property is able to be sold for any figure above the reserve amount without any limit whatsoever whereupon the bidding will only stop when one of the bidders has dropped out leaving just one buyer".