When you are the successful bidder at an auction, the terms of the sale mean that you are buying without any conditions. That means, you don’t need time for your finance to be approved and you don’t have another property to sell first. So when the hammer drops the sale is immediately unconditional.
There is no cooling-off period as there usually is with a standard private treaty contract. You can’t change your mind!
What should a buyer do before an Auction to be prepared?
Arrange your finance – remember it will be a cash contract and not subject to obtaining finance
Inspect the property – including professional building, pest, pool inspections as required
Research the market
Obtain legal advice if needed
Get a property valuation
Get a copy of the contract
Find out how much deposit you’ll need to have on the day and how the agent would like you to pay
Set a budget for your bids on the day
Register to bid with the selling agent before the auction begins.
Why won’t the agent give me an idea of price?
It’s illegal for the agent or the seller to provide a price guide for an auction property. This is because they actually can’t know how high the bidding could go.
With the seller’s approval, the agent could give you a comparative market analysis (CMA). This document will have a list of similar properties in the area that have sold, so that you may draw your own conclusions about price.
What is the reserve price?
It’s the minimum price the seller will accept for the property. The reserve is set before the auction and prevents the property from being sold too cheaply or for an unacceptable price. An auctioneer is not allowed to tell you what the reserve price is, but during the auction he may reveal at a certain point that the property is “on the market” this means that the reserve has been reached and the property will sell to the highest bidder from this point onwards.
I can’t attend the auction but I want to bid – what are my options?
There are two ways. Either by telephone bid with an agent relaying your bids to the auctioneer, or by appointing a representative to bid for you and sign the contract on your behalf. Both ways require forms to be submitted before the auction to the seller’s agent. You can find the forms you need below
Matthews Real Estate works with 5% of the purchase price as the required deposit at the fall of the hammer. This needs to be paid immediately following the auction, or proof of bank transfer provided in the same time frame.
Russell was an outstanding agent. He was professional, honest, easy to work with, and incredibly helpful both before and after we bought our house.
Russell has great knowledge of the area and was able to provide us with very useful information that helped up make our decision to buy. I would have no hesitation recommending Russell; if we ever sell we will definitely be using him.