the house’s sale is now legally binding. In addition to marketing and listing fees the seller has already paid, the auctioneer will typically take a commission of 2.5% of the sale price. Winning bidders must provide proof that they have cash funds available, or a mortgage in place at the point of auction. If the sale is successful, the purchaser will have to pay a 10% deposit on the day with the remaining 90% payable within 28 days of the auction. Timing varies, but generally the time taken from auction to completion is approximately 28 days. You’ll also need to factor in marketing time in the lead up to the auction. You’ll need enough time to generate interest in the property to maximize your chances of achieving a fair price. All in all, you are probably looking at 2-3 months from the point of deciding to sell at auction to completion.
PROS
• If buyers let emotions take over, the bidding war can be fueled by their emotional investment and drive the price higher than it should realistically go. Competition and ego often encourage emotions. Nobody wants to lose so everyone keeps bidding. People get caught up in the auction and end up paying more than the actual value of the property. • The house is sold ‘as-is’ so no fixes and repairs are expected to be done by the seller. You can also leave anything that you don’t need, anything that you can’t be bothered with, and it will be sold with the house. Other than repairs, you also won’t have to worry about city inspections; that’s the buyer’s problem. • There are hardly any contingencies and the deposit is often high. The buyer will not have a way out of the 38
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