What are the benefits and pitfalls? Do you have any advice?

I have found my dream home, and as the house hasn't come onto the market yet I am trying to negotiate a private sale. The house may end up going to auction, so I need to be in a really good position, and need a quick sale (and a good sale price) to be in with a chance on my dream home. I was planning to get my house on the market next week and have been working really hard to get it ready. My next-door neighbour came round yesterday and said he wants to buy my house and that he has the money waiting to buy. We haven't discussed a price yet, as I have no idea what my house is worth (I'll get it valued early next week), I think my neighbour will drive the price down as he is very shrewd, but to have a cash buyer waiting will really help my negotiations on the other house.

get it valued add 5% and let him drive you down
if it's a next door neighbour it's usually good as they are often willing to pay a premium

You might be okay as long as the other one doesn't go to auction before yours has sold. I doubt if you would have long enough to get your sale through before you had to complete on the one at auction. Could always 'bridge' but can be expensive if things drag out.

I'm buying 2 privately at the moment and just completed a 3rd last week as they're all friends or contacts in the property business I'm not getting messed around as we're all happy to be saving agents fees but one that i'm selling through an EA is a NIGHTMARE. It has dragged on since March still with no end in sight and then the agents fees on top will about wipe out any decent profit...