BIDDING AT AUCTION - a decision to buy!
- Make sure you have finalised all the details below before the Auction date. Extensive research is essential for a successful auction purchase.
- Familiarise yourself with the Auction process by visiting as many auctions as you can.
- Have a Building and Pest Inspection done prior to Auction Day.
- Ask questions of the agent/sales consultant and find out everything you need to know about bidding.
- Organise your finance with your Broker or Bank prior to the Auction. A deposit is required on signing the contract. Usually 10% of the purchase price. This may be paid by cash, cheque, bank cheque or money order.
- Inspect the property prior to the Auction date and other properties on the market in the same area. This way you will have an idea where the property may sell on the day.
- Be aware of your upper limit, as you could be bidding against some-one else. It is a binding unconditional contract at the auction.
- An independent valuation, may also give you some idea of how much the property may achieve on the day.
- Ask for a copy of the Contract, note any conditions. You may wish your Lawyer to site the contract prior to the Auction. Ask the Agent for any changes in conditions on the day. The Agent will provide you with the Terms and Conditions of the Auction and read them out on the Auction Day
- Know the dates you are able to “Settle on the property” .
- The “Cooling Off” period is waived. There is no cooling off period.
- The Auctioneer is there to achieve the best price on the day for the Seller.
- The agent is also employed by the Seller to achieve the best possible price the market will pay. He/She also wants to see a sale happen on the day. The experienced sales consultant or agent will do everything they can to help you in the bidding process.
Vendor – Co-Owner – Dummy bids.
· A Vendor bid is where the auctioneer will place a bid on behalf of the seller with a view to assisting the property reach it’s reserve price. Vendor bidding can only be done by the Auctioneer or another legally appointed person and should be declared as part of the auction process before the auction begins.
· A co-owner is a person who has a financial share in the house, such as a divorced spouse, who wishes to buy out the other owners. Co-owner bids cannot be made through the auctioneer and are not announced during the auction. Co-owner bids are declared in the rules set out before the auction begins.
· Dummy bids are illegal in Australia.
· Rules and Regulations for Auctions and Auctioneers are governed by the Fair Trading Act 1989 and the Property Agents and Motor Dealers Act 2000. You can visit their websites for more information.