Buying a house or property
Property auctions can be fast and exciting but many buyers get swept up in the emotion of the auction and can bid more than their preset limit. Smarter Real Estate Solutions gives you more time to think and assess between each bid you place, empowering you to make more informed and strategic decisions. Having a plan for any purchase is still very important so make sure you are well prepared.
A critical point is that once the hammer falls on a Smarter Real Estate Solutions auction, the property is legally yours, and payment will be required as per the agreed terms. A helpful checklist like below better prepares you to bid and to buy.
Set your maximum buying price.
Determine the costs of a property that suits your specific situation, and determine the location you want. Use any mortgage calculator to work out if you can afford the repayments, if you can’t, revise your criteria.
Get your finance pre-approved.
Once the auction ends and you are the successful bidder, the property is legally yours – even if your finance hasn’t yet been approved. It is important to have your loan approved and finance signed off before you start bidding.
Find a conveyancer or solicitor.
A conveyancer, or conveyancing solicitor provides the helps with the legal process required to exchange and settle your contract, ensures compliance, and transfer the title of the property into your name. Essentially they make the buying of a house or property not only possible but legal. You’ll need to nominate a conveyancer or solicitor before you register to bid, as their contact details will be part of your registration form.
Know how an auction works.
Not understanding your legal obligations is not an acceptable reason for reneging on a sale at auction – once the hammer falls, you are accountable for paying for the property.
You must indicate you understand the auction conditions by ticking ‘agree’ when registering. Only once you have done this, will you receive your bidder’s number so you can bid on the auction.
Do your research, know how an auction works, and remember, regulations for buying a house or property can differ a lot between different states and territories.
Check the contract, any conditions in the contract, and the title.
Your conveyancer or solicitor will do this for you, as it is their responsibility to explain all parts of the contract to you, including parts that may affect your purchase. Checking the title basically just means finding out what type of ownership you will have of the property once you buy it, for example, an apartment may have a strata title or company title, and a house may have a torrens title. There may be restrictions on the title that affect your use of the property or what you are buying the property for. Easements, covenants and zoning restrictions are all important to clarify with you legal team.
Building and pest inspection.
Some vendors will provide building and pest inspection reports for their properties, you may also choose to organise independent reports yourself. For apartments and town houses, inspection reports will be available from the strata management group for the external building and common areas. The report also provides other important information, including levies, strata regulations and funds.
Location, location, location.
Go to the area where the property is located and drive around, look at the school, eat lunch in the local shops or at a local café and pop into the supermarket – in addition to google maps, which will show you local amenities, this will give you an idea of how the area feels.
This one can’t be stressed enough. Buying a house or property online by auction is a new process in Australia, but it doesn’t mean you should forget the fundamentals. It’s always a good idea to view or inspect the property or have a representative you trust do this for you.
There are laws around misrepresenting a product for sale in Australia, but it’s still important you inspect the property you intend to buy – if you can, inspect a few times.
Find out the potential of the area.
Talking to the local council or even doing some research online can let you know if the area you’ve chosen is up-and-coming, developed or well-established. Depending on your reasons for buying a property, this will have an impact on how suitable your selected property is to your needs.
Check the boundaries.
This one especially applies if you are buying land, but should be done regardless of what type of property you are buying if it isn’t all contained within the walls of an apartment. Know what you’re buying and what you’re entitled to. Prior to the auction, your conveyancer or solicitor can organise a surveyor who can provide an identification survey to show where the house sits in relation to property boundaries.
Smarter Real Estate Solutions will provide an initial ID check to validate the vendor’s ID by working with a recognised third party system used by a lot of the big banks and finance companies in Australia and overseas. We also require a copy of picture ID which is stored safely offline. In addition, we contact each vendor personally and re-check ID. Despite all of this, when a property is knocked down to you, it’s important your solicitor contacts the solicitor of the other party to check ID before proceeding.
Registering to bid
Smarter Real Estate Solutions will perform an initial check of your ID, similar to that we undertake for vendors, with a third party and picture ID check. Have a scanned copy of your licence or passport ready before registering. You can even just take a picture on your phone and upload it.
Conveyancer and solicitor details.
You’ll need to enter your conveyancer or solicitor’s details during registration – they will also be asked to validate that they have been commissioned by you to act on your behalf, so get in touch with them before registering to bid.
Print an original copy of the sale contract from the property display page. Take this or email it to your solicitor, so they can examine it and have it available for exchange if you are the successful purchaser. Don’t leave this until the auction has started, give yourself and your solicitor or conveyancer time to be comfortable with the conditions of the contract before the auction.