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Buyers’ guide to home auctions

28 July 2010
Young family after purchasing their dream home at auction

Buying your dream home at auction can be stressful so know what's involved to make that winning bid

What you can be sure of on auction day is that the buyer who has the winning bid will sign a Contract of Sale on that day so it is important for all prospective buyers to have their finance approved.

Contracts of Sale for auctions are unconditional – that means every prospective buyer needs to do their homework before they go to auction. Building and pest inspections should all have been done prior to auction day. Likewise, attending open house days and viewing the home by inspection give buyers the opportunity to inspect the property prior to attending the auction.

At the auction, all bidders must register with their name, address and proof of identity. Each registered person is then given a number. If you have registered, you don’t have to bid but you can’t bid if you have not registered.

You need to do your own research on the property. The auctioneer can not tell you anything about the property including what the reserve price.

Some properties have a reserve price and if it is not reached, the property is passed in (not sold). It is not uncommon for vendors to accept an offer prior to the auction so if you really want it, you may consider this. If a property is passed in, there is also the opportunity to submit an offer after the auction.

Attending an auction and bidding can be stressful especially if you really are keen to purchase a particular property. Lessen the stress by getting there early on the day and checking the Contract of Sale to make sure that no last minute clauses have been added.

When bidding starts, make sure that you are in the line of sight of the auctioneer and have a ceiling price that you don’t go over – no matter how much you want to buy the place.

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