With more properties selling at auction in the current property market, we thought it timely to advise prospective purchasers on some points to consider prior to bidding at an auction:
Contract amendments – It is prudent for prospective purchasers to have a solicitor or licensed conveyancer review the Contract for Sale prior to the auction, negotiate any necessary amendments with the vendors’ solicitor and advise you on the important Contract terms. For example, do you require an extended settlement period? You will be unable to amend or vary any of the Contract terms post auction.
Reports – You should satisfy yourself of the condition of the property prior to the auction. Building inspection reports, pest inspection reports and strata inspection reports are beneficial in assisting prospective purchasers. We can assist you in obtaining the recommended reports.
Finance – Prior to the auction you should speak with your finance provider and obtain loan approval to bid to a certain limit at the auction.
Enquiries – You should make enquiries of Council, government authorities, builders and/or tradespersons regarding nearby development or any alterations or additions you may wish to undertake to the property during your ownership.
Purchasing entity – Will you be purchasing the property in your own capacity, in a company name or using a self managed superannuation fund? This must be decided prior to the auction and you should seek advice from your accountant, solicitor or licensed conveyancer as necessary.
Power of Attorney – If you are unable to attend the auction it may be necessary to have a Power of Attorney prepared and entered into so that your attorney may bid and execute the Contract for Sale on your behalf at the auction.
You should remember your finance limits when bidding at the auction. If you are successful the Contract for Sale must be executed and the deposit paid immediately at the auction. There is no cooling off period for Contracts exchanged on the day of the auction. For any further advice, please contact any member of our Property Team who would love to assist you.