You are standing there at the auction of your dream home, palms sweaty as you wait for the auctioneer to close on your bid … heart pounding as the call goes “going once, twice, three times …”
It is like being on a rollercoaster- exciting and nerve-wracking – and the last thing you want to happen is you spend more than you intend. So before you get to the hammer fall, go armed with some tips on how you can walk away with an absolute bargain.
Whether you are buying for investment or simply looking for a new family home, it is imperative that you know what to look for in a property under the hammer.
3 tips to get it right
House vs unit
Houses sell more than units at auction. According to a CoreLogic study in 2015, 20.4 per cent of houses were sold at auction whereas only 16.4 per cent of units were sold. This means you will have more choices if you go for a house. Yes, units can be less expensive than purchasing a house for investment, but think about long term capital gain.
Property trade has phases. Properties fluctuate in price according to a specific pattern: an upturn/boom, a slump, then another upturn. And a smart buyer buys while prices are low and about to return to a high. According to Trading Economics data for the last 10 years, property prices tend to slump and then dramatically increase by the middle of the year, so buy quickly before the increase, and sell on at the peak. Your real estate agent will be able to guide you here.
History never repeats
Get to know the history of the home before you invest. Even if you are planning on buying your first home, think ahead for resale. When it comes to selling and moving on, a house with history can make a huge difference in value. Even homes that have no obvious history may have some tales under the floorboards. Check with your local records office or consider hiring a research firm: you may find some historical nuggets to help add interest and value to your property.