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PREPARING FOR A HOUSE AUCTION: A COMPREHENSIVE GUIDE

  • Writer: Daniel McEntee
    Daniel McEntee
  • Jul 11, 2024
  • 2 min read

Participating in a house auction can be an exhilarating experience; however, it necessitates meticulous preparation to secure a favorable result. Over the past few months, numerous members have engaged in the auction process with success.

In this article, I will guide you through the essential steps to take before bidding on your first home at an auction.

STEP 1: RESEARCH AND DUE DILIGENCE

A. PROPERTY INSPECTION

  • Conduct a thorough inspection of the property to identify any defects or needed repairs.

  • Check for any signs of pest or water damage.

  • Organise a pest and building inspection (these can cost up to $1,000 and are recommended)

B. MARKET VALUE

  • Research the property's market value using online tools or obtain a FREE property report, which your mortgage broker (me) will provide to you.

  • Set a realistic bidding limit based on your findings.

STEP 2: FINANCING AND BUDGETING

A. GET PRE-APPROVAL

  • Stay organised and secure a pre-approved home loan beforehand (I can assist with this), ensuring you have the confidence to make an offer.

B. SET A BUDGET

  • Determine your maximum bidding price, including costs like stamp duty and legal fees.

  • Consider additional expenses like renovations or repairs.

STEP 3: LEGAL AND PROFESSIONAL ADVICE

A. ENGAGE A SOLICITOR/CONVEYANCER

  • Consult with a solicitor/conveyancer in property law.

  • Review the contract of sale and auction terms.

  • Don't hesitate to ask questions or seek clarification.

STEP 4: AUCTION DAY PREPARATION

A. REGISTER TO BID

  • Arrive early to register for the auction.

  • Bring required identification and proof of finances.

B. SET A BIDDING STRATEGY

  • Decide on your bidding approach, such as setting a maximum bid or bidding incrementally.

  • Stay calm and focused during the auction.

CONCLUSION

Preparing for a house auction requires careful research, due diligence, and strategic planning. By following these steps, you'll be well-equipped to navigate the auction process with confidence and secure your dream home.

Additional Tips

  • Don't get caught up in the excitement of the auction – stick to your budget.

  • Consider attending a few auctions as an observer to gain experience.

  • Be prepared for unexpected situations, like a failed bid or post-auction negotiations (this is what happened to my last 2 x members)

  • Reach out to me if you have any questions

 
 
 

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