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Auction

Test your knowledge of auctions.

5 -10 minutes

1. If you win the auction, do you have to buy the property?

Ka pai!

Er, not quite

Auction bids are usually unconditional offers to purchase the property, which means you are committed to buying the property. Make sure this is the right property for you before you attend the auction. You'll need to have your finance confirmed before you bid too.

2. If you win the auction, do you have to pay a deposit on the same day?

Ka pai!

Er, not quite

Usually, you will need to pay the agreed deposit by cheque or by setting up an internet banking payment after the auction.

Deposits are usually around 10% of the price reached in the auction.

3. Will you be told the reserve price set on the property?

Ka pai!

Er, not quite

The reserve is the minimum price the seller will accept for the property. It is private and confidential to the seller.

4. Can a property be sold before the auction date?

Ka pai!

Er, not quite

A pre-auction offer can be made before the auction day. Usually you will know the property can be sold earlier because it will be advertised as 'unless sold prior'.

If this happens, the auction may be held earlier than advertised or the auction may be cancelled.

5. Do you need to have your finances approved before auction day?

Ka pai!

Er, not quite

If you win the auction, you’ll have to buy the house. It’s important to sort out your finances before you start bidding.

6. What does ‘passing in’ at auction mean?

Ka pai!

Er, not quite

Not every property sells at auction. When the bids for the property don’t reach the amount the seller wants for the property (the reserve), it is ‘passed in’. The seller may then choose to sell their property through a different sales method (for example, by negotiation).

7. Can the seller bid on their own property?

Ka pai!

Er, not quite

If the property has a reserve price, the auctioneer (or a representative) will clearly announce a bid on behalf of the seller to help the auction meet the reserve price or to keep the bids moving. A seller cannot continue to bid on the property after the reserve is met.

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