Buying property at the auction may seem a bit unconventional as most people prefer to stick to a more tried-and-tested approach. However, many real estate experts actually believe the auction process is a fair and transparent way of determining the value of a given property. So, while you are out looking for a perfect home, it won’t hurt to give buying at auction a chance. We at Compare Conveyancing Melbourne strongly feel that people looking to buy properties at auctions must seek professional help because circumventing this aspect to save a few hundred dollars may actually cost you a few thousand. Here, is our compilation of expert tips for buying properties at auction in Melbourne.
The Under-quote Procedure
Before you so much as consider making a bid at an auction, it is important to understand the nuances of under-quoting. Most agents throw the auction process open by under-quoting the property value by up to 20 per cent. Keep that figure in mind while you do the math, and bid only if the property fits your budget at its real, not under-quoted, value. Our experts at Compare Conveyancing Melbourne will help with the exact figures so that you place your bid at affordable rates
As opposed to a regular home buying process, you need to keep in money handy when buying at auction because there is no cooling off period involved. Most of the times, the winning bidder is required to make deposit (usually up to 10%) on the day of the sale, unless the contract clearly specifies ‘on their signing hereof’. It is, therefore, important to assess how much you are willing to pay for the house, arrange mortgage or bank loans and have at least the deposit amount ready when you participate in an auction. We are experienced conveyancers Melbourne that helps its clients in securing loans by completing paperwork and approaching banks and lenders on their behalf.
Understanding the Auction Contract
Contracts are often a compilation of legal jargon that sounds like gibberish to a lay person. To avoid being stuck with a contract that the vendor’s real estate agent has drawn up, ask for a copy of the contract beforehand. Our team of experts will do a thorough examination to rule out any nasty clauses. As a buyer, you are also at liberty to add your own clauses to the contract and insist on making a bid provided the contract drawn up by you is honored at the time of sale. You can negotiate directly with the vendor on this.
You Can Say No
Yes, you heard in right. You can say no even after you have made the highest bid and staked your claim to a property. This may not be true in every case, as real estate norms dictate that the highest bidder is under obligation to purchase the property. However, if before signing a contract, a buyer discovers that something is amiss with the house, be it the condition of the property or ownership details, they can decide against buying it. You cannot be held liable for breach of a contract you have not signed. However, if the same faults are discovered after the contract has been signed, there isn’t much you can do about it.
Only an expert is aware of these little loopholes. By employing the services of Compare Conveyancing Melbourne, you can avail the privilege of these loopholes being used to your advantage and not against you.