Vendors love auctions. Most buyers hate them.
However auctions are a fact of life, so switched on buyers do everything possible to reduce their stress levels. The key is preparation.
Let’s imagine you’ve found a property you love, and the jolly thing is being sold at auction. The first thing to do is make sure the agent gives you all the necessary documents. These include:
- a proposed Sale & Purchase agreement
- a Certificate of Title search
- a LIM report
- a Body Corporate pre-disclosure pack (if you’re buying in a Body Corporate)
You may also need a builder’s report and registered valuation to give to the bank.
The costs of these can soon mount up. If you (or your kids) are serial bidders at auctions you can find yourselves thousands of dollars out of pocket. So here’s a tip – don’t spend money on builders’ reports or valuations until you’ve got pre approval of finance.
My next tip is to be aware that a Sale & Purchase agreement can be revised right up till the day of the auction. If it changes you will need to run it past the bank again.
I know someone who missed an agent’s phone call and arrived late at the auction. He put in a successful bid, only to realise that a clause about asbestos had been inserted into the agreement. There were some tricky negotiations before the bank agreed to go ahead with finance.
It boils down to doing your homework. There’s a lot of money at stake so be prepared.
Thinking about buying in the next few months? Make an appointment