Purchase before auction

From: Jan M


Hi
We have found a property we would like to purchase which is going to auction next month.
We would like to make an offer before auction but have been advised not to. We have been told that if we make an offer prior, then the agent will contact anyone who has shown interest in the property and then conduct what amounts to an auction with interested buyers anyway.
Does anyone have any suggestions on the approach to take regarding the potential purchase of this property.
Thanks
 
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Reply: 1
From: John P


Jan that may be true, but if the vendor is a little desperate to sell you just never know!!! Maybe the vendor has neighbors who like to talk a lot... No reason why you can't strike up a conversation with them?? Properties that are "listed" for auction sell pre-auction all the time.

How many people do you think will turn up to the auction if it goes ahead?? Have many people been turning up for open inspection times?

John_P
 
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Reply: 1.1
From: Michael Yardney


In this booming market, vendors are usually well informed and are unlikely to sell before auction unless they get a top price.
Remember ...they have probably been conditioned by their agent that they will get a top price so they would list with him rather than other agents with a lower "quote".
My advice would be to let the agent know that you MAY be interested in purchasing the property and to let you know if it is likely to be sold before auction, otherwise do not give him any indication of price and go along to the auction and fight it out with the others.
There is little doubt that if you make any sort of bid prior to auction that would be considered, the agent will conduct a little mini auction with all the interested buyers.
Michael Yardney
Metropole Properties
 
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Reply: 1.1.1
From: James Doherty


I say make an offer. At this point in the market you will most likely be ripped off at Auction anyway. Be firm with the agent don't let him/her dictate to you. The agents job is to service the Vendors sale, if you make an offer even before an Auction it is the agents job to take it to the Vendor for consideration. Even if the offer is $1. Most dutch auctions are set up between other agents and friends anyway I say tell the agent this and call his/her bluff. If you are in Victoria and you make an offer for a property and sign the S31 contract note, the property is classed as 'UNDER OFFER' and an agent should not be taking any other offers until yours is rejected. Let the agent know that you know this and make them nervous for a change. If at all at least you will know your competion if it does go to Auction.
BE BRAVE DO THINGS DIFFERENT> HAVE A GO.
 
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Reply: 1.1.1.1
From: Kristine .


James

Pardon me, but what does this mean?

"If you are in Victoria and you make an offer for a property and sign the S31 contract note, the property is classed as 'UNDER OFFER' and an agent should not be taking any other offers until yours is rejected."

Could you explain this a bit more, 'cos I've never heard of this before

Cheers

Kristine
 
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Reply: 1.1.1.1.1
From: Michael Yardney


Kristine
I agree with you but didn't want to seem rude by stating that James' negotiating strategy is probably a little naive.
Do you really think your response is going to make the agent nervous?
I you are going to give them a hard time, do they really care about you today in the hottest market in the last 10 years? They know they are going to sell the property to someone and get their commission.
Negotiate with humility and if anything act a little innocent and you will be surprised at some of the things you will find out that won't be disclosed to an arrogant "opponent"
Michael Yardney
Metropole Properties
 
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