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Buying At Auction
A Successful Bid: The True Market Value
Buying at auction avoids the tradition offer/counter offer
negotiation process. If the bid is accepted you'll have the
satisfaction of knowing you have purchased at 'true market
value'. An auction is an exciting, competitive environment where
everything is out in the open. You can see your competitors and
keep track of each and every bid
It may seem difficult, or even daunting, but there are many
advantages of purchasing at auction. When the buyer and seller
meet, and a conclusive sale eventuates, true market value for that property will have
been established. It's proved system of success
Make The time To Get Things Right
Once you have identified an auction property that you're interested in, you'll know
the date by which to arrange finance. You can then sell your existing property,
organise a property check and familiarise yourself with all the auction documents.
Your solicitor can also inspect the title of the property and investigate all legal
matters relating to your prospective purchase.
This time is also when your Harcourts consultant will help you gain a better insight
into the local market -- a very important consideration when trying to assess the
market value of the property. You should also consider obtaining an independent
property valuation as a further guide.
If you've never attended an auction before you should definitely do so before
attending the auction of the property you intend to purchase. This will help you to
become more acquainted with the auction process and it's various features.
Of course the whole process may never get to auction day. Often a property is
purchased 'by prior agreement'. In the instance you can submit an offer to the
property owner for their consideration -- a key step of identifying your interest in the
Let the marketing consultant know if you are interested in a particular property.
Then, if another purchaser submits an offer prior to auction, you'll be contacted and
given the opportunity of submitting your own offer.
Inspect the property as many times as necessary and, if you have any doubts, arrange
for a builder, plumber, electrician or any other tradesperson to accompany you.
Also check the auction documents. Make sure you're familiar with and understand
all the details and conditions of sale (the deposit, possession date, balance of
payment, list of chattels etc). You don't want any unpleasant surprises come auction
Arranging finance is important too. Sale by auction are unconditional, so it's vital to
have finance confirmed before you bid.
On Auction Day
• It's your last opportunity to ask questions before the bidding begins
• The auctioneer will begin by reading the terms and conditions, then talk generally
about the property
• Most auctions are held 'subject to a reserve price' -- the price below which a
property may not be sold. When this level has been reached, the auctioneer will then
announce that the property is for sale.
• Making a bid simply involves making any gestures to attract the attention of the
auctioneer. Be aware that nay bid you do make over the reserve price could be the
one that buys the property.
• 'Passed in' is the term used when a property fails to reach the reserve price. The
highest bidder then usually has the first opportunity to negotiate with the seller or
• If you're successful on the day you'll be asked to sign the sales agreement and pay
a deposit. This is normally 10% of the purchase price.
HOLMWOOD REAL ESTATE LTD
OFFICE PHONE 03 208 1222www.harcourtssouthland.co.nz
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