Check Financial Capacity
It is crucial for buyers to make sure they have sufficient funds before considering bidding on a property, so it is important to check their financial capacity before the auction. If a bank loan is required, bidders need to know their maximum loan capacity and know what they can afford to pay for the property to avoid a blind spike in prices. Prior to the auction, buyers attending the auction should prepare the cheque book and the deposit. Once the bid is successful, a 10% deposit will be required on the spot when the contract is signed and the rest of the payment will be made at the time of settlement.
Review the Contract
Prior to any property auction, the bidders are able to obtain a copy of the contract and they should show it to their solicitors for review in advance. This is because once the bid is successful, the bidder has to sign a purchase agreement with the seller on the spot and cannot change or cancel it. In addition, there is no cool-off period for the purchase contract signed after the auction. Therefore, reviewing the contract can help bidders understand any possible risks associated with the property they are looking at, and also can ask for professional advice on how to protect themselves from these risks.
Get a Professional Building Report
It is important that the bidders are aware of any potential problems with the home before the auction starts. Many people rely on their instincts and look at a property only for its newness. However, some homeowners will spruce up their properties in the hope of covering up defects and increasing the price. Unless the bidders are builders, they are buying blindly without a professional report. Bidders must find qualified people to conduct a building and pest inspection. These professionals will know what to look for, such as damage or defects in the properties and issues that could pose a safety hazard. And if the properties are strata title, then also don't forget to obatin a copy of the strata report.
Check More than Just the House Condition
Checking out the neighbourhood before a home auction is also something that many people overlook. Before any auction there is usually open house when potential buyers can view the property they are interested in. And you should not just check out the house itself, but also the surroundings. If possible, try to make an appointment to view the property at different time of the day to gauge noise levels, light conditions and traffic flow. Demographics of the suburb, school districts, flood zone and power lines are the things that you should also consider. Another is to check real estate websites to see what other owners comment this area.
Register to Bid with Proper ID
Prior to the auction, the bidders must register with the selling agent to get a number. They should provide identification, a card or document issued by a government or financial institution showing their name and address, such as a driver licence or learners’ permit, a vehicle registration document, etc. This is extremely important on the auction day.
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