Buying at Auction

Buying a property at auction is often a simple and straightforward process. It’s quick, transparent, and can be a great way to secure the property you want. Our licensed salespeople are skilled in this process and can assist you throughout. Once you’ve identified a property, follow these simple steps:

Preparing for the Auction

• Inform your salesperson: Let your salesperson know you’re interested so they can keep you updated on all developments and inform you of any pre-auction offers
• Check the property’s condition: Satisfy yourself as to any building or structural matters. We recommend getting a pre-purchase building inspection from a reputable company.
• Review disclosed defects: Ask the salesperson about known defects and request the available disclosures and reports. Have your lawyer check how any relevant matters are documented.
• Examine local authority issues: The vendor may provide an up-to-date LIM (Land Information Memorandum). Have your solicitor review this for any compliance issues.
• Have your solicitor review the documents: We recommend your solicitor peruse a copy of the Auction Conditions of Sale to ensure there are no contractual issues. This document will also list the chattels, the settlement date, special clauses, and any known defects. Check the chattels list carefully to avoid any surprises.
• Secure your finance: All auction purchases are unconditional. If you are the successful purchaser, you must pay the deposit required by the auction agreement. This is often 10%, but check the amount, payment timing and arrangements for the particular property before bidding.
• Note: If you wish to alter any standard conditions (such as the settlement or deposit), this can be arranged with the salesperson prior to the auction if the vendor agrees. This is called a Side Agreement.

In compliance with the Real Estate Agents Act 2008, you will be given a guide approved by the independent Real Estate Agents Authority titled “NEW ZEALAND RESIDENTIAL PROPERTY SALE & PURCHASE AGREEMENTS GUIDE.”

Bidding

• Bidding is simple: To bid, simply let the auctioneer know by raising your hand. If your bid is accepted and the hammer falls, you enter an unconditional sale and purchase agreement. Ownership transfers on settlement. If not, you’ve still gained valuable insight into the current market.
• Genuine bidders only: Dummy bidding is unlawful. Distinguish genuine buyer bids from any clearly identified vendor bid permitted by the auction terms.
• Understanding vendor bids: The Contract of Sale permits the auctioneer to place bids on the vendor’s behalf to move bidding toward an acceptable price. Any vendor bid must be permitted by the auction conditions, below the reserve and clearly identified as a vendor bid.

Confirm finance for the specific property, insurance availability, your bidding limit and any agreed variations before auction day. A pre-approval alone may not be unconditional approval to buy this home. Ask your lawyer to check the title, agreement and relevant property records before you commit.

Plan the practical arrangements before the day

Confirm the venue or online arrangements, start time and registration process with the listing salesperson. Ask what identification and documents you need and allow time to complete the requirements. Have your bidding limit and deposit arrangements settled before the auction begins.

If you cannot attend, ask whether telephone or online bidding, or a person bidding on your behalf, can be arranged for this auction. Complete any required authority and approvals in advance, confirm who will communicate your bids and test the agreed connection. Our auction livestream is a viewing route; watching it does not register you or give you authority to bid.

If bidding pauses or the property is passed in

The auctioneer may pause to speak with the seller or a bidder. Keep to your agreed limit and listen carefully to any announcement when bidding resumes. A pause is not, by itself, confirmation that the auction is over or that your bid has bought the property.

Passed in means the property has not sold at auction. There may be an opportunity to negotiate through the salesperson, but check the terms with your lawyer before making a further commitment. Auction conditions can continue to apply for a period afterwards; do not assume you can immediately add a finance or other condition. The applicable documents and any proposed change need to be understood first.

For the wider process, return to our Buying Guide, including property checks, preparing an offer and settlement.

Read Settled’s independent auction guidance. See upcoming auctions or contact our team about a property you are considering.