Private treaty or auction are two types of ways to purchase property.
Buying your house with a Private treaty
- Finding out as much information as possible from the agent may be helpful to you. For example, if you find out the vendor has purchased another property already, they may be more willing to negotiate on the purchase price.
- Try to keep your enthusiasm for a property to a minimum when talking to the agent.
- Never start with your highest offer. Begin low so that there is room for you to negotiate.
- If your offer is accepted you will usually need to pay a 0.25% deposit on the day however a cooling off period will normally apply in which time valuations can be conducted and a formal approval is gained prior to you paying your 10% deposit.
- It is always best to have a conditional approval prior to beginning to look for a property so you know exactly how much you can borrow.
Buying your House at Auction
At auctions you will be required to pay a 10% deposit immediately and there is no cooling off period so you need to be very careful. Issues can arise such as if the property values less than the purchase price you will need to provide the difference between the value and the purchase price. If you cannot come up with the extra funds you are at risk of losing your deposit. Below are some useful tips in regards to auctions -
- Ensure you have finance approved and do not bid above your limit.
- Complete the necessary building and pest inspections prior to auction.
- Get your conveyancer to look over the contract prior to auction.
- Take photo ID with you and remember to register to bid.
- Have your deposit ready to pay on the day of the auction.