For some, the fear of the unknown keeps some buyers away from auctions. But regardless of whether you’re a first home buyer or investor, being prepared and having a strategy can help you secure a fantastic property.
Better still when the auctioneer’s gavel comes down on the final price and contracts are signed, the sale is unconditional and binding for both parties.
However, before you rock up to an auction, which can be held onsite at the property or in rooms where multiple properties might sell under the hammer, it’s essential to do some preparation and have a good idea about the property’s market value.
Also, properties sold at auction are usually subject to a reserve price, which is the minimum price the vendor will accept. The agent can’t disclose the reserve price so you will need to monitor the results of properties sold recently in the area.
Carrying out your due diligence before the auction is a must. If you’re successful on the day, there is no cooling-off period so you must carry out a thorough inspection, which can include a pest, and building inspection or strata report. Also commission a solicitor or conveyancer to review the contract.
Also, be sure to a organise a loan pre-approval with a bank or lender. A finance specialist such as Our Broker can assist with a preapproved mortgage. Call Our Broker today on 02 8232 0327 as part of your preparations.
If you’re new to auctions, it will be helpful to attend a few before your big day. By attending an auction, you can become familiar with the process, which in turn could help you confidently make a move when your turn arrives to bid for a property.
On auction day, arrive early and find a spot suitable for watching the other bidders and that enables the auctioneer to find you when the bidding starts. With all your preparation in place, when the bidding starts, relax and you’ll be pleasantly surprised how your preauction homework will work in your favour.
If the property is ‘knocked down’ to you, at this point, you’ll be required to sign a contract and pay a deposit that is usually 10% of the property’s value. It might also be savvy to organise some insurance to protect your interest in the property.
If you’re considering buying a property under the hammer or visiting a few auctions to familiarise yourself with the process, contact your local Raine & Horne agent.