10 things to keep in mind when buying property at auction
As much as buyers dislike them, auction sales remain a well-used tool of selling agents, especially in a heated market. So if you have to compete at auction, remember these 10 things:
1.Check the property out as fully as you can. That might include pest and building inspections, neighbourhood investigation, council enquiry, strata inspection report, etc. Try to know as much as you can.
2.Enlist good professional help. Get legal advice about the auction contract and negotiate contract terms prior to the auction. Speak to your accountant about tax issues and the name the property should be purchased in.
3.Ensure that you have your finances in order. If you need to borrow, be certain that you have a ready and willing lender in place.
4.Discuss the property and the vendor’s expectations with the selling agent, but receive that information with the knowledge that the agent is acting for the vendor, not for you
5.Have a clear strategy for the auction. Know when you intend to start bidding and when you must stop. If someone is to bid on your behalf, advise the auctioneer or agent beforehand and follow their instructions in that regard.
6.Listen carefully to the auctioneer when the property is introduced particularly in relation to any last minute changes to the contract or in relation to the vendor’s bids.
7.Be aware of where the bid is at all times during the auction.
8.Be aware of when the reserve price has been reached, because from that point the property will sell to the highest bidder.
9.If you are the highest bidder or the under bidder when the property is “passed in” (because it did not reach the reserve price), speak to the agent as you should still have a chance of being able to negotiate with the vendor after the auction.
10.If the property sells at the auction or on the same day, remember there is no cooling off period. The contract is binding as soon as it is exchanged.
Taurus Mortgage Services Pty Ltd (Registered Mortgage Broker) is available to assist you to raise a competitive Mortgage Facility and Hatch & Associates Solicitors is available to act as your Solicitor in respect of the purchase or sale of your property.
For further information, contact Gordon Hatch on gordon@taurusfinancial.com.au or call 02-9411-4161.
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