Sydney is one of the most expensive real estate markets in the country, driven by strong demand that is pushing clearance rates towards 80%.
With NSW’s property market being as competitive as it is, buyers have had to learn smart strategies to quickly close in on a great property. It’s important to be well informed before heading into an auction event, as it gives you the competitive edge as a bidder.
Here, we provide some proven tips on how to maximise your results when buying in a NSW auction:
1. Get the lay of the land
In a place like Sydney, where affordability is currently a problem especially for homebuyers and investors alike, it’s important to do extensive research into the desired suburb. Be aware of where growth is heading and how sales are tracking. It would be wise to attend a few auctions, just to observe the process and see how other bidders strategize to get a good deal.
2. Make sure the property has been appraised properly
The NSW government recently cracked down on under-quoting by agents, by requiring that they provide evidence to support a property’s valuation. Ensure that the auction you’re planning to attend provides a clear price guide in its advertisements. It also goes without saying that you should visit the property you’re thinking of buying; selling agents typically hold open houses before an auction, so make sure you explore the home as much as you can. Get a certified pest control inspector to check out older homes, and you may also want to review strata reports if the property is part of a strata scheme.
3. Put your name down
In NSW auctions, potential bidders must pre-register with the selling agent before being granted the right to bid. Registrants must present ID with their names and addresses, and are thereafter given a bidder number. The details are then logged into a Bidder’s Record, which is kept until three years after auction. If you register, you don’t necessarily have to bid – but you can’t participate in the auction without it.
4. Watch out for the vendor bid
Only one can be made, but it could change the game, depending on how you’ve plotted your bidding strategy.
5. Stick to your budget
In areas like Sydney where prices are bound to skyrocket quickly during a bidding war, you have to know where you stand financially. Remember that the winning bidder is required to pay a deposit after securing the property (usually 10%), and must already sign the contract and seal the sale according to its conditions. Therefore, you should ideally have funds in place before going to an auction.
In a market like NSW, you want to act quickly to capitalise on available properties – a mindset shared by many hopeful buyers. Competition can get heavy, but if you attend an auction already knowing what you need to do, you can gain the upper hand and walk out a happy new homeowner.
At Conveyancing.com.au we’ve guided many of our clients through the daunting auction process. Feel free to call us anytime, even on the weekend, and our concierge team will be happy to answer any questions and walk you through the process. Call us on 1300 932 738 or contact us online here.
This article is provided for general information purposes only. Its content is current at the date of publication. It is not legal advice and is not tailored to meet your individual needs. You should obtain specialist advice based on your specific circumstances before taking any action concerning the matters discussed in this article.