Buying after property is passed in an auction

Hi,

Looking for some guidance here.This is in Sydney

We are interested in a property which is going for auction.Chances of it getting passed are very high as the agent indicated there hasn't been much interest from buyers.We are interested as our priorities are different.
Thing is in current environment I dont want to buy in an auction as its unconditional, would still like to have finance,B&P clause and a cooling off period.

So the question is if the property passes in auction, and if I make an offer on the same day, will this be considered as private sale and hence including the standard cooling off conditions OR will it still be sold as unconditional?
My solicitor says it depends on vendors how they want. Still wanted to check with PC members.

TIA

 

Just remember that the agent is only concerned about a sale. They WILL put pressure on the vendor to sell on the day (by getting them to accept the lower price).

There isn't anything wrong with buying at auction. There is also a possibly of them needing you to waive the cooling off period as part of the offer, so buying post auction means nought anyway.

In situations where there isn't a lot of interest, the auction process is probably the most transparent.

The highest bidder means squat. A good agent will still bounce between all interested parties who stay behind to negotiate. The only difference is that you don't know what the bidders are offering as they are in their little corner while you are in yours.

If aren't confident in your skills to read the situation and formulate a decision, best to higher a BA who is a professional at this - @Propertunity

 

In Sydney, it's not very common to have subject to finance and/or b&p clauses. Even with a cooling market, people still need time to adjust.

By all means give it a go, you might get a good result. But also be prepared to told to go away and laughed at by the agent (yes they will do that to belittle you and "challenge" your ego)

 

If it were me this is how I would approach it.

1. Look interested but not desperate on the day. Don't make any offers if no one bids. Let it pass in. If the agent pressures you to make some bid to secure it, I wouldn't. No need to bid against yourself. Also no need to show emotional softness. Once it's passed in the power (generally) shifts back to the buyers. From an emotional and psychological standpoint the sellers are in a weaker position. (generally)
2. Approach agents (if not approached first and you should be) after auction to negotiate directly. If there was obviously no one else interested then you can push hard for what you want. If you know there were 2-3 other smarty pants like you there, then gotta be more reasonable. Just how to read the situation?, For a newbie its a lot harder than an experienced investor. Generally if there is no strong interest behind the scenes, the agents will have desperation on their faces and in the language they use with you post auction. As @neK said, the agent is not on your side OR the Vendors (as some naive people think). They just want the dam deal done so they can get their moolah and go home.

Do not, I repeat, do not act/look desperate throughout the shenanigans of all of it. They will eat you up and spit you out faster than you can say "contract"!

Isn't RE fun

Good luck.

 

Well no harm in getting more eyes and ears on the issue

I'll just watch and hope it passes in the auction as it provides more room for negotiation

Thanks for your tips

 

The private sale bit in the above is strange. A private sale is one without an agent isn't it?

If you want to know cooling off periods see section 66T Conveyancing Act
CONVEYANCING ACT 1919 - SECT 66T No cooling off period in certain cases

 

Private sale here means private treaty facilitated by agent. Link

 

Generally when purchasing on the day of the auction, after the property has been passed in, the property is still sold under action conditions. Thus no cooling off period or "subject to" clauses.

 

s 66T(c) = no cooling off if contracted same day as auction after passed in.

 

In Melbourne I think it is 'auction conditions' for up to 3 days after the auction.

Not sure about NSW. If @Sai11 had an offer accepted the day after the auction in NSW, would that be considered 'auction conditions' or 'private treaty'?

 

I believe on the day it's usually auction conditions when it's passed in. Next day is private treaty.

But that's irrelevant. It's whether the agent / vendor wants a 66w (unconditional).

Anything can be negotiated.

 

private treaty - see legislation above.

 

Yes thats right. In NSW, its auction conditions untill mid night of auction day, next day its private treaty

 

Tbh I have no idea why you would be asking strangers legal advice when you are paying your lawyer for advice and to have your back. Go call them and get the information you need - otherwise what are you paying them for.

 

Why not put a written offer in before auction with the terms you want? Properties do sell before auction and it saves the vendor auction fees if the offer is reasonable.

 

I reckon let it pass in... buyer has more power. Vendors just wants to move on, so they may accept a low offer. In Sydney right now, that's where many markets are.

Ps. Save the vendor some money? Why would you, the buyer, even be thinking like that? I'd rather make the seller happy by being their buyer when clearly there is no other interest. Be the "knight" who goes, ok, I'll rescue you from your dilemma!