Read Time: 3-4 minutes
PROBLEM: Auctions Force You to Spend Before You Win
Most buyers:
- Pay lawyers to review contract, title and LIM report.
- Get building inspections.
- Secure a valuation on an urgent basis (if required).
If they lose, that money is gone. This can range from $1,500 to $2,000 including GST.
Back to base camp to start again.
RISK: You Could Lose Money Without Buying a Home
- No conditions, no cooling-off period
- If issues arise, you’re stuck.
- You need to do all your due diligence in prior to the auction and not after the auction.
SOLUTION: Wait for the Property to Pass In...
1. Skip the Auction
- Track properties you like and note auction dates.
- Use a spreadsheet or table.
- We recommend using realestate.co.nz and creating a list of favourites.
2. Talk to Your Lawyer & Mortgage Advisor
- Tell them you’ll only act if the property passes in.
3. Follow Up With the Agent
- If it doesn’t sell, ask the agent to contact you. They will.
- You can then negotiate with conditions.
- If you are successful with a conditional offer, then you can start spending money on due diligence: legal review, building report and valuation (if required).
4. Submit a Conditional Offer
- You only spend money after your offer is accepted.
UPSIDE
✔️ No wasted costs.
✔️ More negotiation power.
✔️ Better contract conditions.
DOWNSIDE
- You might miss out if another buyer steps in, but at least you did not waste any time or money!
TL; DR
✔️Avoid auctions, track results
✔️ Only spend after an offer is accepted
✔️ Negotiate with conditions
