Hi everyone,
I have been avoiding properties which are on auction and dismissing any property that does not have a set value.
Am I missing good oppertunities? Does anyone have any experience or advice on auctions?
Lena
Hi Lena,
Auctions can be goldmines! You can purchase property well under value as we have picked up a number of positive cash flow properties this way.
Having said that, I have gone to auction whereby the price sold on the day was twice of what the sales agent initially predicted.
Providing you have done your research, you have nothing to lose with an auction. However, it only has to come down to one other bidder who could end up costing you thousands.
It’s important to stick to your budget and not let emotions get involved!
Crystal
Positive Cash Flow Investments
As an investor the beauty is you don’t have to get emotionally involved. Simply do your numbers based on what profit you want to make if a reno or what you would pay it otherwise if a private sale and stick to your guns. I’ve been to auctions where there is only 1 bidder and they have got bargains but also to others where a bidding war has pushed prices well above reserve. It can be hard to tell somtimes. Another option is to but in an offer weeks before to tempt vendor to sell and risk not selling at auction
In my experience some Area’s differ from others. I myself and a Real Estate Agent in Logan. As I act on Behalf of the Vendor I never recommend Auctions as Statistics show in the area that houses sell for less at Auction in this area, as this area is a First home owner market area. If you want a bargain at Auction you can’t go passed Logan.
Aslam Sargeant
Wow great advice guys!
I will go to a few in my local area to get a feel for it. I don’t want to go to a place I actually want to buy incase I get carried away the way most ametures do!
By the way is it true that I have to have finance organised before hand and that there is no cooling off period? Can I buy subject to building & pest inspections, or do I have to organise them before the auction?
I’m getting excited at the new possibilities unfolding [biggrin]
Lena
Thanks for asking the question Lena, this is something that i need to know asap as well. As far as i know, there are a “special conditions” in the Contract of Sale, which specify that purchaser has inspected the property prior to the day of sale. Can put a cross on this clause??? and add on my clauses???
And is it required to sign the contract of sale on auction day???
Please share your experiences with us, thanks in advance…Right now in the current market situation of interest rate rises and an increasing cost of living auctions are a real opportunity.
It’s unfortunate but there are a number of mortgagee in possession sales taking place right now. More unfortunately though you wont find them screaming out to you from the newspapers papers. They’ll just be advertised as plain old auctions. The instruction on there properties though are pretty clear, get them sold. They are happening every weeked in a suburb near you. They are selling sometimes 20% under what you would expect to pay.
Avoid auctions and you could be avoiding opportunities to purchase well under the market.
[cigar]
Opportunity in everythinng
We personally avoid auctions…….for us its worked well not buying through auctions…….. Sure there are probably great opportunities at auctions but what we’ve found is that we may do a whole heap of research and due dilligence like we do for every property we’re serious about and then go to auction and not even get a bid in.
We find that there are just as many opportunites with normal sales
hope this helps
Kim Anand
[email protected]“Money Can’t Buy you Happiness but it Does Bring you a More Pleasant Form of Misery”
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