Frequently asked questions when buying a house privately at Auction

Do I have to be in a cash position to bid?

Yes, to bid at an Auction you need to have arranged your finances and completed any due diligence. 10% deposit is required on the day of the Auction and the balance is due on the settlement date.

How do I work out what price I should pay for the property?

The auction process allows you, along with the rest of the market, to first view the property and then determine what you’d pay for it. The vendor may have a rough indication of what they think it is worth, however as the buyer, you will often have your own thoughts, based on your experience of viewing other similar properties and doing your own homework. If you are still uncertain, there are cost effective online reports available or you can get an Independent Registered Valuation for added peace of mind. Feel free to get in touch with us for advice on who to use in this regard.

What if I need to sell my own house?

With prior permission from the seller, you may be able to arrange a longer settlement in order to organise and get your own property sold once you’ve successfully bought this property at the Auction (or prior to auction). With the speed in which property marketing now reaches the potential buyers for your home, this may be a feasible option, so talk to HomeSell about getting your property on the market ASAP! Alternatively you may be able to arrange ‘Bridging Finance’ with your bank to cover any overlap.

How do I borrow the money when I don’t know what price I’ll buy the property for?

Most lending institutions are conversant with the Auction process. Once you’ve worked out what you think the property is worth, speak with your bank about arranging pre-approval on finance up to a certain bidding level. You will then know just how high you can bid at the auction. Depending on your position, some banks may require a registered valuation. Make sure you speak with your lender as far in advance of the Auction date as possible to ensure you are in a position to bid on the day.

Can I have someone else bid for me?

Of course! This may be an experienced member of the family, trusted friend or your solicitor. You will need to ensure they know how high you can go and you will need to be there to sign the paperwork and pay the deposit if successful. If you are not able to be present, ensure they have permission in writing nominating them as your representative on the day. If you will not be contactable by phone during the bidding, then the form giving permission must also state a maximum figure of which to bid. Alternatively, with prior approval from the seller and Auctioneer, you may be able to bid by phone.

Happy bidding!

Disclaimer:
This blog is offered in good faith as a blog only and it is recommended that all parties should seek legal and/or professional advice before entering into any agreement or bidding at Auction. HomeSell accepts no responsibility for any inaccuracies in a) this blog or b) the marketing information supplied by the vendor or c) changes made during the sale process by the vendor.