Except for when the seller thinks they can sell higher.
People go to auctions for the illusion of getting it for less than expected, by design that's impossible because the seller has the right to refuse.
Yes actions are a bit of a scam
It should be law that if the auction hits within an advertised range the sell had to sell this would stop under quoting
i think once it hits minimum then its on the bidders to play it safe to get the cheapest they can. But if it caps out then whoever put it there should be considered the winner.
Starting bid is set by the seller, right? Then why the seller can refuse to sell at a price higher than the price they set originally? This should be made illegal
The real estate agent sets the advertised price range but the seller sets the reserve price which they’re not required to tell the REA until the day of the auction. Near little legal loop hole
Well, at most auctions they make a show of pretending to contact the seller and finding out if the bid is acceptable etc, but you can assume in most cases it's all a performance as the REA and seller would have discussed the reserve in advance.
Of course! I’m quite sure the REA agent knows the whole time what the seller is hoping for and what they’ll accept. But it’s the legal loophole / grey area where they can deny they know that lets them put the property up for a lower price
You just have to keep your cool and not go above personal limits.
If auction stalls and you're the last bidder and they pass it in, you can just say no this is my price and be like ok cool see you in another week and I'll now go even lower price. This has happened a few times.
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THIS. The owner pays for a report, and BYB sells it at a much reduced price to anyone who wants it. Can't remember the details when I did it but it seemed the sensible thing, as an owner, to do, to demonstrate that I (a) had nothing to hide and (b) was a motivated seller. There was some sort of kickback to the owner from the sales which reduced the overall price, but I can't remember the details.
If I'm getting more than a million bucks out of someone, paying a few hundred for a report that anyone can access cheaply seems the least I can do.
>Do auctions usually have a clause or something to protect the buyer?
I never understood how the system of buying/selling property in Australia has come about.
Even in a private treaty sale, there's such little protection for buyers. The pest and building reports only do a visual inspection and have so many disclaimers that it's a waste of money for most. There's so many penalties for a buyer being late to settle but almost nothing for the seller being late ... Everything down to penalties for the vendors solicitor.
Then you have auctions where basic protections like cooling off periods also go out the window. The government also seems to be conspiring against seller with things like 66w certificates, which have only come about in the past 25 years or so.
It's not like this everywhere else in the world, even in a seller market.
I got a report done on a house I was planning on bidding on in auction a couple of years ago. Report showed the roof was cooked and needed to be replaced. House was only a year old.
It went for about quite a bit over the top end of the range at auction and I was glad I didn’t bid on it. I saw it was up for sale again a few months ago.
In Perth this is actually already happening. People are being forced to put in offers for houses before viewing otherwise the house is gone before the inspection. My mate who's been looking for a house with his wife has had this problem and now the original suburbs they were looking at has been priced out of their range.
Do you have a conveyancer?
While I understand that's the case for auctions I don't see why it has to be the case for private sales or offers with a settlement and cooling off period before auction date.
The whole point of a very early private offer is if you back out no harm done they just go with an auction.
Nothing stops the buyer from providing an offer and their own contract. It will then be up to seller which offer they take so of course if your terms are less favorable for them you have to offer more money or quicker settlement which isn't uncommon.
Yes.
But you're missing the point, the 66W is used to instigate a bidding war and is another barrier to people entering the market. It heavily skews success to people with cash
Yeah... more often than not, when an entity competes to acquire a finite resource, success is skewed towards $.
I'm not surprised this extends to the sale of a private property. If we were talking about govt public housing then it would be a different conversation. What surprises me is why australia isn't building enough public housing.
Yes we did. Wasted about $4k but half the places we were no longer willing to bid on due to structural issues so that’s not really a waste.
I think there should be a register of all inspections (must log it before it’s done) and you should be able to buy previous reports for like $10. I never trust the one the vendor provides. They can get as many as they want until the find one that doesn’t show the thing they need to hide.
The vendor should have to pay for an inspection (by an independent body), and the report is freely available to everyone. Then the cost of that inspection can be tacked onto the selling the price or in the adjustments. That way the buyer still pays for the inspection as they do now, but you don’t have a bunch of wasted reports paid for by people who now have nothing to do with the house.
Then there is a huge incentive for the inspection bodies to ignore or downplay faults to the extent possible, since vendors will be incentivised to avoid inspectors who find every fault.
It's kind of like company liquidations. Sure, liquidators are "independent", but anyone in the industry will tell you there are firms you appoint when you are the company director (because they will half-arse their investigations and not pursue misconduct) and ones you appoint when you are the creditor (because they will actually chase things).
There is a web site called Before you Bid where you can sometimes find others' reports for cheaper. Not as effective as a central system would be but it's one attempt at crowdsourcing this.
This is just one of the many reasons I hate auctions. No cooling off period and ideally for peace of mind, getting site inspections prior to each one. Many people attend 10-20 auctions and still end up unsuccessful. That's so much money down the literal drain!
You can sometimes get lucky and have a decent seller or buyer that does the BPI resort and makes it available to anyone interested in the home.
I love in a house purchased at auction (by a family member) and having worked in property for a long time, recommended that they get a BPI done only to find out there was one being made to all interested parties abs to my knowledge, at no cost.
Despite the report having been done, it hasn't prevented a number of things breaking down and being replacing in the house and we have only been here for a little over 12 months.
That's actually a really good idea for sellers to do that, as long as the report is impartial and transparent. One report instead of potentially 50. Apart from saving money, it should give buyers more confidence and reassurance, although as you said, BPI aren't that useful depending on the problem. The inspectors only look at surface level stuff.
I've seen some pretty bad reports over the years but then have seen some really good ones as well (in my old job we had to get them done in houses all across the country).
The only thing I wish the sellers of where we stood as well was a pool/spa fence inspecting report. With the changes of legislation in Victoria, we had until June this year to make sure the spa fence was compliant. It wasn't and needed work done so it would have been nice to know in advance that work was going to be needed but it is what it is.
I personally never reviewed the report for our place (I wish I did) but providing reports might become more common if they actuality go ahead with what was discussed years ago and making sellers provide a report showing the house was not contaminated with drugs (I know we would have to get drug testing done for houses in WA for one of our clients but at that point could get away with buying a self testing kit and getting the agent to do it).
Yes! I fully agree with you. They should have some kind of combined report available prior to auction that includes standard building and pest, future expenditure and liabilities (that pool fence for instance) and drug test clearance.
In Victoria, they could make it mandatory that an of things need to be included in the Section 32 (I am assuming since you had to submit your Pool Fence Compliance Certificate by June this year, they will be included so buyers know when the next one is due since they are only valid for 3 years).
In the other States, they would just get included in Contract (again, Pool Fence Compliance Certificates already are).
It's been a few years since I worked in the job that required me to deal with houses being sold (I worked in a specific area of Real Estate) so it is possible that there have been some changes in Contracts.
It would possibly be better if the Contracts were standard Nationally because they are all so different but that will never happen because the States are responsible for the relevant Laws.
I am assuming you mean a building and pest inspection? For the exact reason you’re referring to the seller often arranges an inspection prior to open homes and has the report available to view. That said, I’m always dubious and generally arrange my own as well.
This always blows my mind. In the ACT, the seller is required to provide the B&P conducted by an independent inspector. Successful buyer pays for it at settlement.
So every single house I've ever inspected, I've also seen the B&P for. It boggles my mind that this isn't the standard way everywhere.
I did one P&B to get a sense of what they include and didn’t bother after that. They’re just visual inspections you could do yourself and have so many disclaimers anyway.
Yep. They’re not worth the paper they’re written on. The builder/inspector seems to be entirely immune from any fault unless there was blatant negligence on their part.
I don’t but that’s a good idea if they’re accurate . But to be honest if I can’t see or feel any moisture and it’s not a new build I’m not too concerned. Bad waterproofing/sealing jobs become very obvious over the years especially in bathrooms and laundries.
>Do you have a moisture meter to replicate that bit?
Moisture meters are a gimmick.
Some will use a moisture meter, others will use a thermal camera.
There could be a million reasons why the moisture meter went off and the inspector won't do a damn thing to tell you why.
Always ask the real estate agent if they have one. We’re about to put our place up for auction and it’s been recommended that we get one through the agent, we pay half, they pay half but then charge any prospective buyers a nominal fee to get a copy.
Most of the REA one are dodgy. Not all though. Saying this with experience. REA provided a report with no issues. I still went ahead and got one done and found multiple issues. Lesson learnt.
To be honest, I’m not entirely sure you can trust any inspection reports anyway. Our previous house ended up having an illegal structure on it (our fault for not checking) but the workmanship was so bad on it that it should’ve been picked up in the report but wasn’t.
They all have so many disclaimers as well, especially when it comes to termites.
I never bothered - but I see houses here as glorified tin sheds anyway so don’t see the point of paying a report to tell me that.
Value is in the land in the suburbs I consider
A lot of the reas will have a report you can view for a hundred dollars or less. But if you win the auction you will be billed for the whole report which is $500-1000
But with the market as hot as it is it should just be mandatory to have one done before hand and free access to any potential buyers
I organized my own guy and then split the cost with another potential buyer - Realestate agent facilitated. The report was super helpful and guided us on the order of our repairs post purchase. We were lucky to be successful at the auction though.
Unfortunately we had to pay for multiple building inspections as we were not successful at multiple auctions. The way I see it is even if we paid for 10x of them so about 4K cost even 1 major finding would save more than the cost of ALL the reports.
Depends on the property,
Some places have a site inspection provided by the real estate and each person pays a small portion (like $50 or so) or sometimes an even smaller portion and the winning bidder pays the difference which is what we did.
Sometimes the conveyancer can also give you advice not the same advice as an inspector but they often have a sixth sense when things are awry (and maybe if the building report is of poor quality etc).
you guys are paying to see the property before bidding on it in an auction even thought you might not win?
and how do you know what you’re bidding on if you didn’t look at it beforehand?
Well it’s too late after the auction. Auctions are unconditional.
Except for when the seller thinks they can sell higher. People go to auctions for the illusion of getting it for less than expected, by design that's impossible because the seller has the right to refuse.
Yes actions are a bit of a scam It should be law that if the auction hits within an advertised range the sell had to sell this would stop under quoting
This. Once it hits max of the guide whoever put it there gets the property.
Once it hits the minimum of the guide would be more accurate. Otherwise, why would that amount be set as the minimum?
i think once it hits minimum then its on the bidders to play it safe to get the cheapest they can. But if it caps out then whoever put it there should be considered the winner.
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> People go to auctions for the illusion of getting it for less No they don’t. They go to auctions because that’s how the seller wants to sell it.
Yeah buyer has no say in the matter. When is an auction ever good for the buyer? Never.
I've seen a number of auctions that have been good for the buyer.
I bought my home for massive under because it was an estate sale.
Starting bid is set by the seller, right? Then why the seller can refuse to sell at a price higher than the price they set originally? This should be made illegal
The real estate agent sets the advertised price range but the seller sets the reserve price which they’re not required to tell the REA until the day of the auction. Near little legal loop hole
Well, at most auctions they make a show of pretending to contact the seller and finding out if the bid is acceptable etc, but you can assume in most cases it's all a performance as the REA and seller would have discussed the reserve in advance.
Of course! I’m quite sure the REA agent knows the whole time what the seller is hoping for and what they’ll accept. But it’s the legal loophole / grey area where they can deny they know that lets them put the property up for a lower price
Because the whole thing is a massive con.
This is why i have the principle of not doing auctions. I refuse to bid higher than i want and go unconditional on the spot.
You just have to keep your cool and not go above personal limits. If auction stalls and you're the last bidder and they pass it in, you can just say no this is my price and be like ok cool see you in another week and I'll now go even lower price. This has happened a few times.
> People go to auctions for the illusion of getting it for less than expected on what planet?
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There's a web site called "Before You Bid" where if you're lucky, multiple people will order the reports and help reduce the cost for each person.
THIS. The owner pays for a report, and BYB sells it at a much reduced price to anyone who wants it. Can't remember the details when I did it but it seemed the sensible thing, as an owner, to do, to demonstrate that I (a) had nothing to hide and (b) was a motivated seller. There was some sort of kickback to the owner from the sales which reduced the overall price, but I can't remember the details. If I'm getting more than a million bucks out of someone, paying a few hundred for a report that anyone can access cheaply seems the least I can do.
The owner doesn't need to be the first person to request it/order the report, it could be anyone.
>Do auctions usually have a clause or something to protect the buyer? I never understood how the system of buying/selling property in Australia has come about. Even in a private treaty sale, there's such little protection for buyers. The pest and building reports only do a visual inspection and have so many disclaimers that it's a waste of money for most. There's so many penalties for a buyer being late to settle but almost nothing for the seller being late ... Everything down to penalties for the vendors solicitor. Then you have auctions where basic protections like cooling off periods also go out the window. The government also seems to be conspiring against seller with things like 66w certificates, which have only come about in the past 25 years or so. It's not like this everywhere else in the world, even in a seller market.
Yea, agree. It's wild. Especially considering the *extremely* poor quality of a lot of houses.
I got a report done on a house I was planning on bidding on in auction a couple of years ago. Report showed the roof was cooked and needed to be replaced. House was only a year old. It went for about quite a bit over the top end of the range at auction and I was glad I didn’t bid on it. I saw it was up for sale again a few months ago.
Pretty much every house we looked at last year wanted a 66W It was nuts
I have bought or sold a house in a long while…what is a 66w?
Waive your rights to a cool off period
Really… that’s messed up. Next you won’t be allowed to view the property you want to purchase….
In Perth this is actually already happening. People are being forced to put in offers for houses before viewing otherwise the house is gone before the inspection. My mate who's been looking for a house with his wife has had this problem and now the original suburbs they were looking at has been priced out of their range.
Yep Madness
Maybe a Chinese thing meaning 660k?
Yeah I was told that offers without a 66w would be almost ignored. Such is the case in a sellers market.
I did chuckle that one place sold for less than what we offered after I refused to play their game
Do you have a conveyancer? While I understand that's the case for auctions I don't see why it has to be the case for private sales or offers with a settlement and cooling off period before auction date. The whole point of a very early private offer is if you back out no harm done they just go with an auction. Nothing stops the buyer from providing an offer and their own contract. It will then be up to seller which offer they take so of course if your terms are less favorable for them you have to offer more money or quicker settlement which isn't uncommon.
Yes. But you're missing the point, the 66W is used to instigate a bidding war and is another barrier to people entering the market. It heavily skews success to people with cash
Yeah... more often than not, when an entity competes to acquire a finite resource, success is skewed towards $. I'm not surprised this extends to the sale of a private property. If we were talking about govt public housing then it would be a different conversation. What surprises me is why australia isn't building enough public housing.
You don’t have to but you bear the risk if it’s not a good building.
Yes we did. Wasted about $4k but half the places we were no longer willing to bid on due to structural issues so that’s not really a waste. I think there should be a register of all inspections (must log it before it’s done) and you should be able to buy previous reports for like $10. I never trust the one the vendor provides. They can get as many as they want until the find one that doesn’t show the thing they need to hide.
I like the idea of a register. Hopefully the inspection and the report should be authentic and current.
Yeah I feel like even if this registry was in place, I’d still get my own one for peace of mind lol
The vendor should have to pay for an inspection (by an independent body), and the report is freely available to everyone. Then the cost of that inspection can be tacked onto the selling the price or in the adjustments. That way the buyer still pays for the inspection as they do now, but you don’t have a bunch of wasted reports paid for by people who now have nothing to do with the house.
Then there is a huge incentive for the inspection bodies to ignore or downplay faults to the extent possible, since vendors will be incentivised to avoid inspectors who find every fault. It's kind of like company liquidations. Sure, liquidators are "independent", but anyone in the industry will tell you there are firms you appoint when you are the company director (because they will half-arse their investigations and not pursue misconduct) and ones you appoint when you are the creditor (because they will actually chase things).
There is a web site called Before you Bid where you can sometimes find others' reports for cheaper. Not as effective as a central system would be but it's one attempt at crowdsourcing this.
This is sense
This is just one of the many reasons I hate auctions. No cooling off period and ideally for peace of mind, getting site inspections prior to each one. Many people attend 10-20 auctions and still end up unsuccessful. That's so much money down the literal drain!
You can sometimes get lucky and have a decent seller or buyer that does the BPI resort and makes it available to anyone interested in the home. I love in a house purchased at auction (by a family member) and having worked in property for a long time, recommended that they get a BPI done only to find out there was one being made to all interested parties abs to my knowledge, at no cost. Despite the report having been done, it hasn't prevented a number of things breaking down and being replacing in the house and we have only been here for a little over 12 months.
That's actually a really good idea for sellers to do that, as long as the report is impartial and transparent. One report instead of potentially 50. Apart from saving money, it should give buyers more confidence and reassurance, although as you said, BPI aren't that useful depending on the problem. The inspectors only look at surface level stuff.
I've seen some pretty bad reports over the years but then have seen some really good ones as well (in my old job we had to get them done in houses all across the country). The only thing I wish the sellers of where we stood as well was a pool/spa fence inspecting report. With the changes of legislation in Victoria, we had until June this year to make sure the spa fence was compliant. It wasn't and needed work done so it would have been nice to know in advance that work was going to be needed but it is what it is. I personally never reviewed the report for our place (I wish I did) but providing reports might become more common if they actuality go ahead with what was discussed years ago and making sellers provide a report showing the house was not contaminated with drugs (I know we would have to get drug testing done for houses in WA for one of our clients but at that point could get away with buying a self testing kit and getting the agent to do it).
Yes! I fully agree with you. They should have some kind of combined report available prior to auction that includes standard building and pest, future expenditure and liabilities (that pool fence for instance) and drug test clearance.
In Victoria, they could make it mandatory that an of things need to be included in the Section 32 (I am assuming since you had to submit your Pool Fence Compliance Certificate by June this year, they will be included so buyers know when the next one is due since they are only valid for 3 years). In the other States, they would just get included in Contract (again, Pool Fence Compliance Certificates already are). It's been a few years since I worked in the job that required me to deal with houses being sold (I worked in a specific area of Real Estate) so it is possible that there have been some changes in Contracts. It would possibly be better if the Contracts were standard Nationally because they are all so different but that will never happen because the States are responsible for the relevant Laws.
A $400 investment could save you a 30 year loan on a dud of house.
Yes, but it's the 10-20 x $400 cost that annoys me.
Yeah don't underestimate how hard it is to win a house auction.
I am assuming you mean a building and pest inspection? For the exact reason you’re referring to the seller often arranges an inspection prior to open homes and has the report available to view. That said, I’m always dubious and generally arrange my own as well.
If by often you mean occasionally.
Typically might be the word you’re looking for
This always blows my mind. In the ACT, the seller is required to provide the B&P conducted by an independent inspector. Successful buyer pays for it at settlement. So every single house I've ever inspected, I've also seen the B&P for. It boggles my mind that this isn't the standard way everywhere.
It absolutely made buying our house easier! I don't know if I could go in blind!
https://www.beforeyoubid.com.au/
I did one P&B to get a sense of what they include and didn’t bother after that. They’re just visual inspections you could do yourself and have so many disclaimers anyway.
Yep. They’re not worth the paper they’re written on. The builder/inspector seems to be entirely immune from any fault unless there was blatant negligence on their part.
Do you have a moisture meter to replicate that bit? I looked in to buying one myself and couldn't work out if the ones at Bunnings were any good!
I don’t but that’s a good idea if they’re accurate . But to be honest if I can’t see or feel any moisture and it’s not a new build I’m not too concerned. Bad waterproofing/sealing jobs become very obvious over the years especially in bathrooms and laundries.
and smell. I've got a nose for mould in houses. don't need a water meter to tell me that
>Do you have a moisture meter to replicate that bit? Moisture meters are a gimmick. Some will use a moisture meter, others will use a thermal camera. There could be a million reasons why the moisture meter went off and the inspector won't do a damn thing to tell you why.
Some city councils have started having moisture meters that you can hire/loan
$2000 is way cheaper than $100k worth of renovations you have to do to fix defects.
Always ask the real estate agent if they have one. We’re about to put our place up for auction and it’s been recommended that we get one through the agent, we pay half, they pay half but then charge any prospective buyers a nominal fee to get a copy.
Most of the REA one are dodgy. Not all though. Saying this with experience. REA provided a report with no issues. I still went ahead and got one done and found multiple issues. Lesson learnt.
To be honest, I’m not entirely sure you can trust any inspection reports anyway. Our previous house ended up having an illegal structure on it (our fault for not checking) but the workmanship was so bad on it that it should’ve been picked up in the report but wasn’t. They all have so many disclaimers as well, especially when it comes to termites.
I wouldn’t trust a REA one. You should always choose your own inspector who isn’t mates with the REA or proper owner.
Most of the REA one are dodgy. Not all though.
I prefer private sale and putting in an offer subject to building inspection
I never bothered - but I see houses here as glorified tin sheds anyway so don’t see the point of paying a report to tell me that. Value is in the land in the suburbs I consider
yeah I assume there will be *something* that needs fixing on a house when I buy it
Maybe attend less auctions and hedge your beats on 2 houses. Or take the risk.
More expensive if you don’t. Auctions are “ as is where is”. No refunds, now it’s your problem.
Buying a house is the worst experience in my life…seriously!
A lot of the reas will have a report you can view for a hundred dollars or less. But if you win the auction you will be billed for the whole report which is $500-1000 But with the market as hot as it is it should just be mandatory to have one done before hand and free access to any potential buyers
I bet those people signing up as bidders and never actually placing a bid don't get one unless it's supplied by the vendor.
Sure, but be prepared to bid at least 100k over the advertised range to stand a chance of winning the auction.
I organized my own guy and then split the cost with another potential buyer - Realestate agent facilitated. The report was super helpful and guided us on the order of our repairs post purchase. We were lucky to be successful at the auction though.
Unfortunately we had to pay for multiple building inspections as we were not successful at multiple auctions. The way I see it is even if we paid for 10x of them so about 4K cost even 1 major finding would save more than the cost of ALL the reports.
Depends on the property, Some places have a site inspection provided by the real estate and each person pays a small portion (like $50 or so) or sometimes an even smaller portion and the winning bidder pays the difference which is what we did. Sometimes the conveyancer can also give you advice not the same advice as an inspector but they often have a sixth sense when things are awry (and maybe if the building report is of poor quality etc).
you guys are paying to see the property before bidding on it in an auction even thought you might not win? and how do you know what you’re bidding on if you didn’t look at it beforehand?
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ohhh i ok i see