Header Ad Module

Collapse

Announcement

Collapse
No announcement yet.

Auction winner runs off without paying deposit

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Auction winner runs off without paying deposit

    This was last Thursday, this guys bids $30,000 higher than anyone else, he has since jumped on a plane to China and has emailed to say "funds will be coming through shortly" (from a swiss bank!)

    This all seems very odd to me, anyone else been through this, you are legally supposed the pay the deposit straight away right?

    I was the second highest bidder so the vendors have offered (via the estate agent) to cancel the original agreement (having been messed around), as long as I pay the same price..........

    ........ but whose to say this 'dodgy bidders' money will ever come through?

    It's more than I really want to pay, however, it is a nice property so, do I jump in and grab it, just in case the money does come through?

    or
    wait and see, thus being in a better position with the vendors.........?

  • #2
    Depends on how in love with 30 grand you are really. I buy for overseas clients in NZ and you can negotiate to pay deposit after auction no problem. I always get 3 days to allow for funds to be transferred.

    Comment


    • #3
      I usually pay a standard 5% deposit at auction, allows me to hang on to more of my RC for longer.

      FH
      "DEBT BECOMES IRRELEVANT WITH INFLATION".

      Comment


      • #4
        Originally posted by Crookie View Post
        This all seems very odd to me, anyone else been through this, you are legally supposed the pay the deposit straight away right?
        If you are going to do a runner, who is going to stop you walking out the door and not paying the deposit, they can't even force you to stay behind at the supermarket if you have stole something!

        FH
        "DEBT BECOMES IRRELEVANT WITH INFLATION".

        Comment


        • #5
          Crookie - just wonder why you did not bid $30k higher in the first place, if you are going to accept his offer now? Has anything changed since the auction? If nothing has changed and your still think your last highest bid was the max you would pay, I suggest that you negotiate.

          Comment


          • #6
            Originally posted by Crookie View Post
            It's more than I really want to pay, however, it is a nice property so, do I jump in and grab it, just in case the money does come through?
            Don't be pressured by the agent.
            Your top bid was $30k below the winning bid?
            The auction is over - the slate is wiped clean.
            Offer $40k below the winning bid - that is $10k less than your top auction bid.
            Let them sweat.
            Ignore the bleating from the agent.
            See what they come back with - then go up to your auction bid if you have to.
            The winning bidder won't return and no money will be coming through - as I read your description.
            If the money does come through - you haven't lost anything as you didn't win the auction in the first place.
            Stick to your guns - max offer should be your top auction bid.

            Comment


            • #7
              Originally posted by Bob Kane View Post
              Don't be pressured by the agent.
              Your top bid was $30k below the winning bid?
              The auction is over - the slate is wiped clean.
              Offer $40k below the winning bid - that is $10k less than your top auction bid.
              Let them sweat.
              Ignore the bleating from the agent.
              See what they come back with - then go up to your auction bid if you have to.
              The winning bidder won't return and no money will be coming through - as I read your description.
              If the money does come through - you haven't lost anything as you didn't win the auction in the first place.
              Stick to your guns - max offer should be your top auction bid.

              This is generous, I would offer 50k or more below that price. The agent or vendor is very cheeky asking OP to pay the price he wouldn't pay during the auction, they are expecting to be haggled down.

              Comment


              • #8
                Originally posted by Connor View Post
                This is generous, I would offer 50k or more below that price. The agent or vendor is very cheeky asking OP to pay the price he wouldn't pay during the auction, they are expecting to be haggled down.
                This is an interesting point and Exactly how a strong negotiator would approach this however time and time again a strange phenomenon at auction which defies logic happens...

                An open public auction takes place bidders bid openly and drop out at some point making it clear to everyone what they perceive the property to be worth... The highest bidder is left with no competition and the bidding stops but failed to meet vendors reserve... Logic suggests the market had identified the 'value' of that property. It's passed in now open to negotiation... The highest bidder knows no one is prepared to pay more than them for the propert as see in the auction process that had just taken place yet over the following hours/days the property sells often to the highest bidder at a price above their highest bid...

                how does this happen?

                Comment


                • #9
                  Originally posted by Connor View Post
                  This is generous, I would offer 50k or more below that price. The agent or vendor is very cheeky asking OP to pay the price he wouldn't pay during the auction, they are expecting to be haggled down.
                  Explain than you were caught up in the moment and with hindsight your bid $20k above your limit and/or the property's worth. Nothing ventured, nothing gained.

                  Comment


                  • #10
                    I would go with offer less than your final bid as well. Was the winner also the the guy who bid just before your highest bid? To get to the real auction top bid, you would ignore all bids that were from the runaway highest bidder.

                    Comment


                    • #11
                      Originally posted by Teropita View Post
                      I would go with offer less than your final bid as well. Was the winner also the the guy who bid just before your highest bid? To get to the real auction top bid, you would ignore all bids that were from the runaway highest bidder.
                      Ummm, didn't thought about this simple logic, I learn something, thanks

                      Comment


                      • #12
                        The thing you all forget is, if a well attended auction, then if you don't go with what they are offering they will just go tot he next underbidder. High risk of losing it. If they really want it and 30K is not significant overall then just pay the money. If it's to flip or whatever where margins are important then negotiate.

                        Comment


                        • #13
                          Originally posted by Learning View Post
                          Explain than you were caught up in the moment and with hindsight your bid $20k above your limit and/or the property's worth. Nothing ventured, nothing gained.
                          The point is, it's not in the moment anymore, the auction's over, this is a negotiation now, the rules are different. 'Nothing ventured, nothing gained' is the agent's thinking. They're throwing a line out to see if OP will bite and at what price. Play the same game and put in a low offer.

                          Comment


                          • #14
                            Originally posted by Bobsyouruncle View Post
                            The thing you all forget is, if a well attended auction, then if you don't go with what they are offering they will just go tot he next underbidder. High risk of losing it. If they really want it and 30K is not significant overall then just pay the money. If it's to flip or whatever where margins are important then negotiate.
                            Fair enough if you really want it. Pay the extra 30k.
                            But to my thinking - no one else was willing to pay the final bid price so the market price is not really at that price.
                            The vendor wants to sell, but realises that the high bidder is a poor risk so has offered the OP the chance to buy at that price.
                            If the high bidder had not bid they would have sold at the underbid price (I assume reserve was met).
                            So unless the seller wants to wait and see how things go with the run away high bidder or wants to leave it on the market, then the underbid is a starting point.
                            Hey, they can only say no and then it's who blinks first.

                            Comment


                            • #15
                              Originally posted by Crookie View Post
                              This guys bids $30,000 higher than anyone else and has since jumped on a plane to China and has emailed to say "funds will be coming through shortly." (from a swiss bank!)

                              I was the second highest bidder so the vendors have offered (via the estate agent) to cancel the original agreement (having been messed around), as long as I pay the same price.
                              What was the third highest bidder's offer?

                              Pitch your counter offer a little above that figure, perhaps?

                              Comment

                              Working...
                              X