Buying At Auction
Buying at auction
Before you bid at auction you must understand the process and satisfy yourself about all details relating to the property. If you are the highest bidder and your bid is accepted, you are obliged to purchase the property. If buying at auction you should have:
- Decided on a definitive upper limit that you are prepared to pay
- Conducted inspections
- Had legal documents checked by your solicitor/conveyancer
- Organised a bank cheque for the deposit
- Had finance pre approved
Bidding at auction
Prospective purchasers who wish to bid at an auction for residential and rural property must register by giving their particulars to the selling agent before they are permitted to bid.
Bidders are issued with a bidder’s number which is to be displayed when making a bid.
The vendor or the auctioneer on the vendor’s behalf may make one bid which must be announced during the auction. This is called a vendor bid.
If the property fails to reach the reserve price it is passed in. As a courtesy, the highest bidder is usually given the first opportunity after the auction to negotiate further with the vendor through the selling agent. If the highest bidder does not purchase at the reserve price the property will be placed back in the market for sale by private treaty.
Bidding on behalf of a purchaser
If you want someone else to bid on your behalf, they must give the auctioneer a written authority from you, before the auction starts.
The letter must include your name, address and details of proof of identity, such as your driver’s licence or passport.
The practice of bidding by telephone is allowed subject to compliance with certain procedures. A written authority must be given to the auctioneer prior to auction, containing an acknowledgement that the person on whose behalf bids are made, has been given a copy of the conditions that are applicable in respect of the sale, and the bidder is satisfied the person has been given a copy of those conditions. A copy of the contract must be provided to all successful telephone bidders after the auctioneer has signed it on their behalf.