Buying at Auction: Your Simple Plan to Bid with Confidence

Season 21 of The Block has wrapped. The sales story did not finish there. Two homes did not sell at auction. One drew no bids. Out in the wider market the picture looks brighter. Auction clearance rates in the capitals are rising. Here is how to get your auction game in order.

Life can mirror art. Reality TV does not always mirror the market. The Block’s finale proved that. Two out of five homes did not sell on the day. One received no bids at all.

Across the capitals the momentum is stronger. Cotality reports clearance rates of about 72% over the past two weeks. That is well up on 59.50% at the same time last year. More homes are also going under the hammer than at any time in the last 18 months.

Auctions can feel challenging when you are buying a house at auction. You cannot know how many bidders will turn up. You cannot know the reserve. You cannot know the final price. Use the steps below to bring more certainty to your plan.

Buying a House at Auction: Five Steps That Add Confidence

1. Know your borrowing power

Start with a clear view of what you can borrow. If you are buying at auction, guesswork will not cut it. Online calculators give broad guesses and broad ranges. Results can be off the mark. Speak with a lending expert instead. A proper review looks at your income, debts, goals, and time frame. You will leave with a reliable borrowing figure.

2. Set a buying budget

Do not forget the upfront costs. Stamp duty, transfer charges, and loan application fees all add up. Get a full list before you bid. A clear budget reduces the risk of hidden costs that could derail your purchase.

3. Have your home loan pre approved

Pre approval is a lender’s early green light up to a set limit. It still has conditions. It matters at auction because there is no finance clause. Bidding without pre approval is brave or very cashed up. A firm pre approval helps you set a ceiling. It also gives you the confidence to stop at that limit.

4. Get your legal rep to review the contract of sale

Never assume a contract is standard. If you are buying a house at auction and you win, you are committed on the spot. There is no cooling off period. Ask your solicitor or conveyancer to review the contract before auction day. Know exactly what you are buying and on what terms.

5. Do all the normal pre purchase checks

Do not rely on first impressions. Order a building and pest report for houses. Order a strata report for apartments and townhouses. Yes, it is another cost. It can save you from bigger repair bills later.

Buying House at Auction: Plan the Day

When buying at auction, arrive early. Register to bid with time to spare. Set your limit and keep it in writing. Watch the pace of bids and the auctioneer’s calls. Ask if the property is on the market once bidding nears the reserve. Stay calm and stick to your plan.

Call us Before Auction Day Arrives

Selling by auction suits today’s tight markets. It puts pressure on buyers. If you are buying a house at auction, preparation takes that pressure off you. Get organised before you raise your hand.

Buying at Auction: Speak with Osinski Finance

Need help with borrowing power, budgets, and pre approval for buying a house at auction? 



Osinski Finance is a friendly mortgage brokerage that compares a wide range of lenders and products. We help with home loans, investing in a property, and becoming a first home buyer. We work to your brief, explain the costs clearly, and handle the paperwork from start to finish. Contact us today to get auction-ready.

Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to your circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.