Researching the property
Auctions are unconditional, so you need to learn as much as you can about the property prior to the auction or before making a pre-auction offer. Ask your lawyer or conveyancer to review and help you understand any information you get before the auction.
- Work out the value of the property.
- Do a title search.
- Get council information.
- Check the house, land and neighbourhood thoroughly.
- Get a property inspection report.
Learn more about researching the property here(external link).
Let the agent know
If you want to bid for a property at an auction, your first step is to let the agent selling the property know that you are interested.
The agent will have legal documents for you and your lawyer or conveyancer to review. These documents include the auction terms and conditions and the sale and purchase agreement, which includes details such as:
- the deposit amount that the successful buyer must pay
- the settlement date (the date the remainder of the sale price is payable and the keys are handed to the new owner).
The documents may also include reports or further information about the property, for example, a land information memorandum (LIM) or building inspection report.
See a lawyer or conveyancer early to help you through the auction and settlement processes.
Confirming your finances
Because auctions are unconditional, you need to confirm your finances before you attend the auction. If you win the auction, you will usually need to pay the purchase deposit on the auction day. Your lender may want to know specific details about the property before you attend the auction, even if you already have pre-approved lending.
Changing the agreement or adding sale conditions
If you want to change anything in the agreement or put any conditions on the sale, you need to arrange it before the auction by using a document called a variation of agreement. Talk to the agent and your lawyer or conveyancer about any changes. The seller then decides whether they are happy to accept any changes or conditions you propose.
Understanding the pre-auction offer process
A pre-auction offer is an offer that is made before the auction date. If the seller is willing to accept the offer, the auction may be held earlier than the advertised date, or the auction may be cancelled if a sale and purchase agreement is signed.
Sellers may signal that they are willing to accept a pre-auction offer by including the words 'unless sold prior' in their advertising. This doesn't mean that it won't be sold ahead of an auction if this wording isn't included — a seller can choose to sell by signing a sale and purchase agreement at any stage in the selling process.
If you’ve spoken with the agent and registered your interest in the property, they should notify you if another buyer makes a pre-auction offer and the offer is accepted by the seller. If you haven’t registered your interest, you won’t be notified.
If the auction is held earlier than advertised, the pre-auction offer the seller has accepted becomes the first bid at auction. The property can sell any time after that first bid. If you want to make a pre-auction offer, speak to your lawyer or conveyancer and the agent selling the property. Make sure to also check the auction's terms and conditions to understand whether you can withdraw a pre-auction offer. If you can't, your pre-auction offer will become the first bid when the auction starts, at which point you can then notify the auctioneer that you wish to withdraw it.
Planning to bid if you can't attend the auction
If the auction is going to be held in person and you aren’t able to attend, there are a few ways that allow buyers to still place a bid.
If you’re interested in bidding by phone on the day, you should register your interest with the agent. You’ll likely be asked to sign a telephone bidding authority form — this acknowledges a buyer’s intent to bid by phone and permits an agent to bid on their behalf. It's usually given to the auctioneer who will let all other bidders in the room know that telephone bidders are present. Telephone bidding authorities will be approved by the seller in advance of the auction.
Once registered, buyers should receive an auction pack, which includes information such as the conditions of sale, a copy of the sale and purchase agreement and the record of title.
Telephone bidding can also take place online via video conferencing, which allows buyers to see other bidders who are present and the auctioneer. It’s recommended to check your internet connection before you start bidding and to do a test run by viewing an auction for another property beforehand so you know what to expect.
Nominate someone to bid on your behalf
You may prefer to have someone you know and trust in the room bidding on your behalf, for example, a family member or your lawyer or conveyancer. If so, we recommend you choose someone who is experienced with bidding at auctions or has bought property before. You should make sure that they have your written permission to bid on your behalf and know the maximum amount you’re prepared to bid to.