Buying at Auction - All You Need to Know
Your Invitation To The Auction Buyer Information Evening
Every Thursday from 5:30pm until 6:15pm, Takapuna Office, 128 Hurstmere Road
You are invited to our Auction Buyer Information Evening which is designed to increase awareness and understanding of the auction process from a buyer’s perspective, including the following topics:
- Understanding the auction contract
- Benefits of bidding at auction
- Bidding strategies
- Pre auction offers and the auction day process
- Vendor bidding
- What happens if the reserve price is not met
We look forward to seeing you there!
IN ROOM AUCTIONS
Our in room auctions are based at our Harcourts office in Takapuna, 128 Hurstmere Road. We hold in room auctions most Thursday evenings, at 6.30pm.
We are pleased to announce our exciting new relationship with Mudbrick Vineyard, Waiheke Island. With every auction sold at our Thursday night in rooms at Harcourts Takapuna both our owners and purchasers receive a limited edition bottle of Mudbrick Vineyard bubbles. A great way to associate a stunning luxury vineyard with our brand, and a fabulous way to celebrate success!
FREQUENTLY ASKED AUCTION QUESTIONS
How do I work out the price?
The Auction system allows you, the market, to firstly evaluate the house and then determine the price that you want to pay. We find that some buyers become experts in a particular price range and they are able to indicate within a very narrow range what they feel a home is worth. They do this by comparing it to the other homes they have viewed and seen sold in that particular range.
If you need help with a guide to price, ask the salesperson for guidance. Whilst you may not get an actual figure, they will refer you to similar homes that are either on the market or have recently sold. You may also decide to arrange your own registered valuation.
How do I borrow money when I don’t know the price?
Most lending institutions are now familiar with the Auction Process. Discuss the property with your lender and you will probably find that they will agree to lend you money up to a certain ‘bidding price’. You will then know how high you can bid at Auction. We can introduce you to a mortgage broker who would assist you with your finance requirements and may be happy to attend the Auction with you. Overall though, the fact that you are borrowing money should not prevent you from bidding or buying at Auction.
Do I have to be in a cash position to buy?
The straight answer to this question is yes.
To bid at Auction you need to consider yourself to be bidding with cash. If you are the successful bidder on the day, you will be required to pay a 10% deposit upon signing the documents immediately after the Auction. The remaining 90% of the purchase price shall be required on the possession date (which can be anything from 14 to 180 days). Please check.
If your bid is successful, you have bought the property. there are no ‘subject to house sale’, ‘due diligence’ or such like clauses. You are essentially making a cash unconditional offer. There is nothing to be concerned about, so long as you have done your homework and sought the correct advice along the way.
What about selling my place?
The fact that you already own a home and will need to sell, is not detrimental to you buying at Auction. One of the benefits of buying at Auction is that you may, with the permission of the vendors, have a delayed settlement of several months after the date of Auction to organise the sale of your property.
Talk to the salesperson about the possibility that they may have somebody waiting for a home like yours. A quick sale may be easier than you think. You could possibly get a cash offer on your home, which would put you in an extremely strong position to purchase your new home.
What if I’m not in town on that date or I am too nervous, can someone else bid for me?
Of Course! Anyone of sound mind may bid for you on Auction day. However they will require written advice as to how high you wish them to go. People bidding on your behalf may be your solicitor, the salesperson you’ve been dealing with, or an experienced family member. With the permission of the vendor, and if arranged with the auctioneer prior you may also bid by telephone. If you are simply feeling nervous, why not attend another Auction to see what goes on. Spectators are always welcome. Alternatively, we would be happy to answer any questions you may have. Don’t hesitate to call.
What can I do to make sure I don’t miss out?
Register your interest!
If you are interested in the property, be sure to let the salesperson that showed you through the home know. This ensures that if another buyer makes an offer that the owner will accept, as described above, then we are able to contact you and any other registered parties (those who have registered their interest).
What is a Vendor Bid?
The conditions of sale state that the vendor has the right to bid themselves or through an agent or through the auctioneer. This bid may be used to start the auction by the auctioneer or throughout the auction as deemed necessary by the auctioneer. The auctioneer will clearly identify when they are exercising a vendor bid. It is important to note that Vendor Bids are not used above the reserve price.
How do I bid?
As a buyer it is a good idea to have a meeting well before the auction with the salesperson who introduced you to the property to discuss the auction, method of bidding, strategies in bidding and any variations that you may require. If you are unfamiliar with bidding or would prefer not to bid yourself, do discuss this with your salesperson for other options. Our Auctioneers are always available should you require further assistance or advice.
- If you are the successful bidder you will be required to pay 10% of the purchase price straight after the Auction. That is, you need your chequebook and the ability to have sufficient money in your account to cover your cheque when it is banked by Harcourts.
- If you bid at Auction, you are bidding unconditionally and in cash.
- Possession dates can be quite flexible and are stated prior to the Auction.
- Chattels are stated in the particulars and Conditions of Sale please check care fully that they match with what you believe is being left in the name. This does not apply to Mortgagee Auctions.
- On residential homes there is normally no GST payable.
- If you have not already received a copy of the New Zealand Residential Property Sale and Purchase Agreements Guide, I will be happy to supply you with one.
Auctions are an easy way to buy and sell for both vendors and purchasers. The decision to buy or sell through Auction is serious, however and not to be undertaken lightly.
If you are considering marketing and selling by Auction, or indeed have any questions about the auction process, please don’t hesitate to call us. Confidentiality is assured, with absolutely no obligations.
Good luck, and all the best with your bidding!