Aaahhh…auctions, auctions, auctions. They crack me up. Personally I am not a big fan – you tend to get carried away with the competition and spur of the moment and it becomes more about winning than smart investing/purchasing.

And this Auction was a classic case of how not to buy property. There was a couple there that wanted the property way too much. And they weren’t buying it as a home, it was an investment. Now, I don’t know all the circumstances as I was just looking on. But they seemed too attached to NEEDING the property. They bid heavy and consistently and pushed the priced higher and higher. At one stage they both bid – thus bidding against each other! They ended up winning the property. Or did they. They bid about 180k more than the valuate price, not a win in my books.

So… If you ABSOLUTELY HAVE to buy a property through auction, it is a very good idea to get someone else to bid for you. Let them know your absolute limit and let them know not to go above it no matter what. You should also make sure you do all of your due diligence before the auction. If you have any special conditions you want to put in place for the purchase, you need to talk to the agent/vendor before the auction and get written approval on those conditions.

For example, if it is a development site you are looking to buy at auction you may want a delayed settlement. However the normal auction contract may call for a standard 6 week settlement – so be sure to get your conditions approved prior to the auction.

Hope that helps if you have an auction coming up!

Cheers,
Carly