When buying property at a Gold Coast auction, there are a number of things you absolutely must do – that is, legal requirements that allow you to bid. There are quite a few things you should do, and another list of things you definitely shouldn't.
Musts: What you should definitely do prior to bidding at an auction
You absolutely must get your finance lined up before the auction. At auctions you bid unconditionally, which means if you don't get the mortgage you hoped for, or your existing home doesn't sell as fast as you planned, you're still obligated to buy the property. You are required to sign the Contract of Sale and pay the deposit on the same day as the auction. There is no form of cooling-off period during which you can change your mind.
Before you consider bidding, make sure you visit the property. While it's not a legal requirement to view before you buy, it's common sense given your home is one of your biggest expenses. Seeing the property with your own eyes allows you decide if you really do want to live there.
When you visit a property, it's also a good opportunity to check the contract, find out the deposit required and what forms of payment the buyer accepts. If this information is not available when you visit, ask for it well before the date of the auction.
Finally, in order to bid you have to be registered to do so. Being registered allows the auctioneer to award you a unique identifier, such as a numbered board, so your bid is properly accounted for.
Do's: Things you should do before buying at auction
When you visit, you can also make a note of inspections you'd like carried out, as you're responsible for organising these before the day of the auction. If an inspection throws up something that changes your mind, it's too late if you've already won the bid.
Auctions can be a little overwhelming if you've never been to one before. So to make sure you're thinking clearly when it comes to bidding, we highly recommend attending a few auctions before you find a property to bid on. This provides you an opportunity to check out the registration and bidding procedure without it mattering if you don't understand something. You've got plenty of time to ask your agent more questions if something does crop up.
Don'ts: What not to do at an auction
It's absolutely crucial you do not bid on a property unless you intend to buy it. If you are the successful bidder you are legally bound to settle the contract. Changing your mind or not being able to afford it are not acceptable get-out clauses. This is why it's crucial to have your finance lined up before the auction.
Additionally, don't go into an auction blind. You need to make sure you have all the information you need. As we said above, visiting an auction beforehand is a great idea to ensure you're bidding correctly when it comes to your turn.
What else to know about buying property at auction
As well as do's, don'ts and musts, it's helpful to know what else to expect at an auction.
- If there have been any late changes to the contract, the auctioneer must announce this prior to bidding commencing. They must also announce any relevant details, such as the required deposit.
- The auctioneer must be licensed and should display proof in an obvious location.
- Most properties go to auction with a reserve price, but this information doesn't have to be disclosed. Bids only result in a binding purchase once the reserve price is met, however.
If you're in the market for a new Gold Coast property to call home chat to the experts at Ray White Surfers Paradise. We'll guide you through all aspects of buying at auction and make sure your search ends in success.