A Buyer’s Guide to Auctions

Auctions are becoming an increasingly popular way to buy property. However, purchasing at auction is different from traditional methods, and buyers need to be well prepared.

What You Need to Know About Buying at Auction

Property sales by auction are unconditional. Once the hammer falls and the agreement is signed, both buyer and seller are legally bound to complete the purchase.

Important Steps Before the Auction

Buyers should conduct thorough due diligence before bidding, including:

• Obtaining a LIM (Land Information Memorandum) report

• Getting a building inspection report

• Having a lawyer review all auction documents, such as the deposit amount, settlement date, chattels included, and the certificate of title

  
  

Finance and Deposits

Make sure your finance is approved before the auction and be ready to pay the 10% deposit immediately if you win the bid. Note that KiwiSaver funds cannot be used for the deposit on auction purchases.

Pre-Auction Offers and Post-Auction Options

You can inspect the property before auction day. If interested, you may make a pre-auction offer under the auction terms. If accepted, the auction date may be brought forward.

If the property doesn’t sell at auction, the highest bidder gets the first right of refusal to negotiate immediately after. If negotiations fail, the property will be offered to other interested buyers.

How Arnet Law Can Help

If you’re considering buying property at auction in Pukekohe, South Auckland, or Waiheke, Arnet Law’s experienced property lawyers are here to guide you through the process. We’ll ensure your interests are protected every step of the way.

Visit Arnet Law today to learn more and get expert advice.