SOLD! Your Guide to Purchasing a Property at Auction19-10-2021 | Resource | Brent Jones
From soaring price increases to predictions of a looming “bust”, media coverage of the Sydney property market has probably made anyone looking to buy a property this year a little nervous.
Not only that, the recent shortage of supply in the market has also led to an increase in the use of auctions to sell properties, which can be daunting for purchasers. At an auction, once the auctioneer says “SOLD”, if you are the highest bidder you are legally bound to go through with the purchase so you really need to have everything in order and be ready to go on the day.
Our handy guide to buying a property at auction can help to ensure you have everything in place!
Step 1 – Review the Contract
If you find a property that you are interested in purchasing, you should request a copy of the Contract for Sale from the real estate Agent. The property team here at Lamrocks can then review the contract for you, and if required, seek clarification or amendments prior to the Auction to ensure that there are no ‘nasty surprises’ in the contract and you don't get caught out.
Step 2 – Arrange your Finance and Access to a Deposit
Before the auction, you should contact your financial organisation or broker to arrange formal loan approval and determine your bidding limit for the auction. It is important to have this clarified before you place a bid!
You should also make arrangements to have the required deposit amount ready, as this must be paid once the auction is finished.
Step 3 – Pre-Purchase Inspection Reports
It is important to obtain any inspection reports (i.e. Pest Report, Building Report or Strata Inspection Reports) before attending the auction so that you are aware of any issues that might affect the value of the property. This is particularly important when you are purchasing at an auction because there is no "cooling off" period once the property sells and the contract requires that you must accept the property condition subject to all faults and defects. Lamrocks can obtain all of the necessary searches and reports in advance so that you can feel confident in bidding for the property.
Step 4 - Signing the Contract
If you are the successful bidder at the auction, you will be required to sign the Contract on the spot and pay your deposit.
Once the Contract is signed and dated, it will be sent to Lamrocks so that we can liaise with the other party and organise settlement, which is usually six weeks from the date of the Contract, unless you have negotiated a longer period.
If you would like more information on purchasing a property at an auction, or if you have found a property that you would like to buy, contact our experienced property and conveyancing team on ph 02 4731 5688. We can guide you through the purchase and ensure everything runs as smoothly as possible.