Buying at Auction

Old May 6th 2007, 10:10 pm
  #1  
Forum Regular
Thread Starter
 
Joined: Apr 2007
Posts: 215
jads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to alljads is a name known to all
Default Buying at Auction

Has anyone any experience of auctions in NZ. lots of houses on the net seem to be sold by auction. Why is this, is it because they are sheds (in the uk sense of the word!) or because they want a quick sale.

Any info appreciated

Jads
jads is offline  
Old May 6th 2007, 10:24 pm
  #2  
Baa Baa
 
Joined: May 2007
Location: Mangawhai
Posts: 93
KiwiKate will become famous soon enoughKiwiKate will become famous soon enough
Default Re: Buying at Auction

No experience, but it's just pretty much the norm out here - auction or tender sales are just as abundant as set price sales. I guess they speed up the process for vendors (assuming the auction is successful!) You get lots of opportunity to view properties with 'open home' days before the auction, to be sure it's not a garden shed!
KiwiKate is offline  
Old May 7th 2007, 1:10 am
  #3  
Memetchi
 
cypherpunk's Avatar
 
Joined: Oct 2005
Posts: 201
cypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to all
Default Re: Buying at Auction

They're a common part of the sales process in NZ. Not all houses go to auction and of those that do not all of them sell (about 50% in my own unscientific survey here in Christchurch).

Auctions can be a useful tool to bid prices up in a hot market, or they can used by real-estate salespeople to crunch sellers down to a price for a quick sale after the salesperson "bought the listing" by promising an unrealistically high price. Neil Jenman's book "Don't Sign Anything", which deals with the real estate sales process in Australia and NZ, is well worth getting for some background to this, though he does go a bit over the top at times.
cypherpunk is offline  
Old May 7th 2007, 9:17 pm
  #4  
Forum Regular
 
ezzkazz's Avatar
 
Joined: Jan 2004
Posts: 273
ezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud ofezzkazz has much to be proud of
Default Re: Buying at Auction

Originally Posted by KiwiKate View Post
No experience, but it's just pretty much the norm out here - auction or tender sales are just as abundant as set price sales. I guess they speed up the process for vendors (assuming the auction is successful!) You get lots of opportunity to view properties with 'open home' days before the auction, to be sure it's not a garden shed!
sorry to sound dumb but what is 'tender' with regards to a house sale?
ezzkazz is offline  
Old May 7th 2007, 10:02 pm
  #5  
Baa Baa
 
Joined: May 2007
Location: Mangawhai
Posts: 93
KiwiKate will become famous soon enoughKiwiKate will become famous soon enough
Default Re: Buying at Auction

Not an expert myself far from it! I think the general idea is any interested prospective buyer puts together an offer package ie amount offered, how it will be funded (cash, mortgage etc) how quickly they can complete, and the vendor than chooses with advice the best all round offer.

She thinks!
KiwiKate is offline  
Old May 8th 2007, 12:11 am
  #6  
 
Joined: Apr 2007
Posts: 1,454
Avid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond repute
Default Re: Buying at Auction

Originally Posted by ezzkazz View Post
sorry to sound dumb but what is 'tender' with regards to a house sale?
The house is put on the market for a fixed period of time. People must make an offer for the house before the time limit is up. The seller can then choose the best offer.

A little bit like an auction...but in slow motion and nobody knows what the others have bid.
Avid is offline  
Old May 8th 2007, 12:14 am
  #7  
BE Forum Addict
 
simonmarkellis's Avatar
 
Joined: Nov 2006
Location: Whitby Wellington
Posts: 2,440
simonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond reputesimonmarkellis has a reputation beyond repute
Default Re: Buying at Auction

So how do these auctions work? Are you standing out in the street outside the property whilst some bloke is paying attention to the odd nudge and a wink or is it inside somewhere like an auctions rooms where houses are sold one after the other?
simonmarkellis is offline  
Old May 8th 2007, 12:18 am
  #8  
 
Joined: Apr 2007
Posts: 1,454
Avid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond reputeAvid has a reputation beyond repute
Default Re: Buying at Auction

Originally Posted by simonmarkellis View Post
So how do these auctions work? Are you standing out in the street outside the property whilst some bloke is paying attention to the odd nudge and a wink
Yes. Or inside the house if it's wet. And you can have internet auctions as well..

Last edited by Avid; May 8th 2007 at 12:21 am.
Avid is offline  
Old May 8th 2007, 2:49 am
  #9  
Memetchi
 
cypherpunk's Avatar
 
Joined: Oct 2005
Posts: 201
cypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to all
Default Re: Buying at Auction

Originally Posted by KiwiKate View Post
Not an expert myself far from it! I think the general idea is any interested prospective buyer puts together an offer package ie amount offered, how it will be funded (cash, mortgage etc) how quickly they can complete, and the vendor than chooses with advice the best all round offer.
Yep, that is pretty much right. In most respects it is better for the seller because the buyers need to name their best price straight away, but it limits their market to buyers who are prepared to wait weeks to hear whether or not their tender has been successful.
cypherpunk is offline  
Old May 8th 2007, 2:58 am
  #10  
Memetchi
 
cypherpunk's Avatar
 
Joined: Oct 2005
Posts: 201
cypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to allcypherpunk is a name known to all
Default Re: Buying at Auction

Originally Posted by simonmarkellis View Post
So how do these auctions work? Are you standing out in the street outside the property whilst some bloke is paying attention to the odd nudge and a wink or is it inside somewhere like an auctions rooms where houses are sold one after the other?
Sometimes in the house, sometimes at the agent's office and sometimes elsewhere. Dodgy practices reportedly include quoting low estimated prices to buyers to get them to attend (e.g. my wife was told the guide price was $600k for a property that was obviously going to sell for at least $700k and eventually sold before auction for $750k), taking non-existent bids "off the wall", agents "crunching" bidders by putting massive pressure on them to go over their original limits, and auctioneers bullying sellers into accepting a price below their reserve. So be careful out there.
cypherpunk is offline  
Old May 8th 2007, 4:06 am
  #11  
Give us a kiss
 
Biddy's Avatar
 
Joined: Feb 2005
Location: Peka Peka - Kapiti Coast - Nice!
Posts: 3,140
Biddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond reputeBiddy has a reputation beyond repute
Default Re: Buying at Auction

Originally Posted by simonmarkellis View Post
So how do these auctions work? Are you standing out in the street outside the property whilst some bloke is paying attention to the odd nudge and a wink or is it inside somewhere like an auctions rooms where houses are sold one after the other?
I'd recommend going to an auction or 2 just to see how the process works and to give you an idea of what houses are fetching. Make sure you sit on your hands though!
The local Harcourts has a purpose built room at its offices which once a week they have auctions rather than having them at the site itself. I have heard that there is inevitably someone there whose job it is to bump the price up a bit by bidding to keep others in. True? Who knows but sounds likely!
Biddy is offline  
Old May 8th 2007, 5:38 am
  #12  
Baa Baa
 
Joined: May 2007
Location: Mangawhai
Posts: 93
KiwiKate will become famous soon enoughKiwiKate will become famous soon enough
Default Re: Buying at Auction

Hmmm, hearing that kind of stuff puts you off a bit, eh?? I guess you just have to know your limit, and be made of steel on the day.
KiwiKate is offline  
Old May 8th 2007, 9:07 am
  #13  
Here in Dunedin
 
southerner's Avatar
 
Joined: May 2003
Location: Dunedin
Posts: 1,975
southerner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond repute
Default Re: Buying at Auction

We bought at auction, and thought the process was pretty good on the whole.

Some pointers:
- attend at least one auction in advance to see how its done
- when the hammer falls you pay the deposit (normally 10%)
- there are no "subject to's", you need to have your finance, any building reports or legal advice all sorted in advance
- you can make a pre-agreement with the vendor on varying the standard terms. For example we agreed that if we were the successful bidder we would settle on a different date.
- know who you are bidding against, look at them and form a view on whether they are genuine
- use a reputable agency, if they bid up the price themselves they should be open about that; eg. they will say "I bid.." I haven't heard of them taking bids from mates, but no doubt it probably happens.
- and most important of all, only pay what it is worth, not what you can afford because you've just sold in the UK and are cashed up. PLEASE!!!
southerner is offline  
Old May 8th 2007, 9:16 am
  #14  
Here in Dunedin
 
southerner's Avatar
 
Joined: May 2003
Location: Dunedin
Posts: 1,975
southerner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond reputesoutherner has a reputation beyond repute
Default Re: Buying at Auction

On a slight tangent, but related to my last point above, in theory new arrivals in NZ should probably we willing to pay less than locals for any particular house, because:

- they know less about the asset (eg. how much it might cost to run, or maintain)
- they know less about the location
- they do not really now if they will settle well in NZ, and may have to sell at market value within a short period (when you can't ride out any short term drops in the market).

Sounds good in theory, but in practice (and I guess its natural when you consider the purchasing power some have) plenty of peeps do outbid the locals. I'm not necessarily saying that is wrong, but I do not of some who have not recovered the purchase price when they have moved on.
southerner is offline  

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Contact Us - Archive - Advertising - Cookie Policy - Privacy Statement - Terms of Service - Do Not Sell My Personal Information -

Copyright © 2018 MH Sub I, LLC dba Internet Brands. All rights reserved. Use of this site indicates your consent to the Terms of Use.