Today I went to an auction of a brand new property around the Parramatta region (not Parramatta/Westmead though) on a relatively busy road. My aunty has been looking to buy a property and has enough cash to put on a 500k-600k property. The property we saw was a 5BR double story house on 300sqm (on a subdivided land). The vendor built another 5BR single house at the back (which has a rumpus room with a kitchen and bathroom - more of a granny flat underground) - but the one at the back is shockingly planned.
So I went to the auction. I didn't register myself for the bidding - though by registering, I could have made some bids on behalf of my aunty. There was another Asian family (genuine bidders) and another man came in (Lets call him Mr. X). He was asked to present his licence and with utter confidence he said, I live next door - he literally announced it to the whole room with a handful potential owners. So my aunty started bidding (knowing that it's worth more) at $450k. Mr. X smiled and bid 500k. So the bidding kept going and the Asian buyers were also increasing. This was my first auction so I literally stopped the auctioneer half way to tell him off from influencing people to increase their offer by 5k haha
(But apologised at the end when I realised he is supposed to do that).
Mr. X was constantly on phone and off it - wandering out as well to the lawn. So my aunty (who had YESTERDAY given a cheque with an offer of $560k prior to auction) even went up to $586k - definitely emotional. Following this the auctioneer - after confirming with the vendors - declared the house was on the market. The Asian bidders went upto $586,500. Mr. X came back with $590k. The auctioneer kept trying to get $500 out of my aunt and the other Asian buyers but no body agreed. While this was happening, I had a conversation with Mr. X who said he just had a NAB valuation done on this front property and it came back at $643k and why would he not buy ~$60k below market. All up APPARENTLY he was saving ~$110k It was almost as if he was trying to convince us! He also said he was going to buy the one at the back as it was "cheap"
Then, we just decided to walk out waiting for the agent to return the cheque to my aunty. The agent wouldn't return the cheque. No body wanted to attend the auction for the back house. So we were waiting and waiting. The auctioneer came to the front and said to us and the Asian buyers that Mr. X has changed his mind and no longer wants to pay $590k and since the Asian buyers had the opportunity to buy at $586,500. So I got a bit pissed off and said, how does that work?! He must sign the contract at the price he bid and that is unconditional. And that this can go to fair trading. So the auctioneer was taken aback and threw up his hands and said okay lets ask him to sign it and it's sold. The Asian buyers also thought there was some "conspiracy" there. Personally I wouldn't want to pay for what they are asking (offers over $550k and close to 600k implied). Given the surrounding sales have been for around $625k for established brick homes in good condition on 700sqm. It was one heck of a drama! When we got out we saw the seller driving out in his Merc from the house next door (remember Mr. X said he came from next door!)
We were THANKFUL that it did not work at $586k. I don't think the bank will value it at $586k.
An hour later the agent called my aunty and said the house was still available So my aunty asked if it was at today's price or yesterday's offer. The agent said yesterday's offer was alright. But the agent was then reminded that the offer made yesterday was a PRE auction offer.
Following this I called the agent (and she doesn't know I'm related to the other buyer) saying to her I was there (she has only ever spoken to me on the phone and only one of them recognise me who had already left lol). I told her the other bidder was a dummy bidder and that there is a potential fine of $55k. She said she had suspected that and had asked him already if he was a dummy bidder and he had ALREADY signed the contract. Further she will call me if the house becomes available. They know my aunty is a serious buyer and now they have blown their chances for getting anywhere near $590k!
The agent said the settlement won't be for another 6 months - I don't understand why as our solicitor had said it should take just 6 to 12 weeks for registration.
That aside, how could people do that?! IF Mr. X was genuine and then walked out wouldn't he be liable for 10% PLUS being sued by the vendor for the difference between the winning bid and the actual selling price?
So I went to the auction. I didn't register myself for the bidding - though by registering, I could have made some bids on behalf of my aunty. There was another Asian family (genuine bidders) and another man came in (Lets call him Mr. X). He was asked to present his licence and with utter confidence he said, I live next door - he literally announced it to the whole room with a handful potential owners. So my aunty started bidding (knowing that it's worth more) at $450k. Mr. X smiled and bid 500k. So the bidding kept going and the Asian buyers were also increasing. This was my first auction so I literally stopped the auctioneer half way to tell him off from influencing people to increase their offer by 5k haha
(But apologised at the end when I realised he is supposed to do that). Mr. X was constantly on phone and off it - wandering out as well to the lawn. So my aunty (who had YESTERDAY given a cheque with an offer of $560k prior to auction) even went up to $586k - definitely emotional. Following this the auctioneer - after confirming with the vendors - declared the house was on the market. The Asian bidders went upto $586,500. Mr. X came back with $590k. The auctioneer kept trying to get $500 out of my aunt and the other Asian buyers but no body agreed. While this was happening, I had a conversation with Mr. X who said he just had a NAB valuation done on this front property and it came back at $643k and why would he not buy ~$60k below market. All up APPARENTLY he was saving ~$110k
It was almost as if he was trying to convince us! He also said he was going to buy the one at the back as it was "cheap"Then, we just decided to walk out waiting for the agent to return the cheque to my aunty. The agent wouldn't return the cheque. No body wanted to attend the auction for the back house. So we were waiting and waiting. The auctioneer came to the front and said to us and the Asian buyers that Mr. X has changed his mind and no longer wants to pay $590k and since the Asian buyers had the opportunity to buy at $586,500. So I got a bit pissed off and said, how does that work?! He must sign the contract at the price he bid and that is unconditional. And that this can go to fair trading. So the auctioneer was taken aback and threw up his hands and said okay lets ask him to sign it and it's sold. The Asian buyers also thought there was some "conspiracy" there. Personally I wouldn't want to pay for what they are asking (offers over $550k and close to 600k implied). Given the surrounding sales have been for around $625k for established brick homes in good condition on 700sqm. It was one heck of a drama! When we got out we saw the seller driving out in his Merc from the house next door (remember Mr. X said he came from next door!)
We were THANKFUL that it did not work at $586k. I don't think the bank will value it at $586k.
An hour later the agent called my aunty and said the house was still available
So my aunty asked if it was at today's price or yesterday's offer. The agent said yesterday's offer was alright. But the agent was then reminded that the offer made yesterday was a PRE auction offer. Following this I called the agent (and she doesn't know I'm related to the other buyer) saying to her I was there (she has only ever spoken to me on the phone and only one of them recognise me who had already left lol). I told her the other bidder was a dummy bidder and that there is a potential fine of $55k. She said she had suspected that and had asked him already if he was a dummy bidder and he had ALREADY signed the contract. Further she will call me if the house becomes available. They know my aunty is a serious buyer and now they have blown their chances for getting anywhere near $590k!
The agent said the settlement won't be for another 6 months - I don't understand why as our solicitor had said it should take just 6 to 12 weeks for registration.
That aside, how could people do that?! IF Mr. X was genuine and then walked out wouldn't he be liable for 10% PLUS being sued by the vendor for the difference between the winning bid and the actual selling price?
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