Listed below are some of the terms to know and understand in an auction.
A pre-auction offer is a situation where the seller allows you to make an offer before the actual auction begins. The process of the contract remains the same as a regular transaction for property. If the offer for the contract is allowed within three days of the official date for the auction, it will be a permanent commitment and non-negotiable.
An auction runs in a very particular manner with certain procedures that aren’t compromised. It is helpful to know these beforehand. Before the bidding begins, the auctioneer will inform the bidders of certain rules to follow. Here are some prominent ones to keep in mind:
- The rules of the auction should be followed carefully
- If anyone were to engage in any unethical bidding behaviour, they would be fined for it
- The auctioneer will confirm the status of the vendor; whether there will be a single vendor or co-owner bids
- Any kind of disturbance made during the auction would be met with severe fines
- Raising any kind of false bids is deemed illegal
- Once the hammer is dropped, any number of bid requests will be denied
- The bidders will be identified only at their request
Due Diligence Checklist
The due diligence checklist is an important addition. All those interested in selling need to carry this with them, as it enables buyers’ inspections. This list is made to help the respective purchasers find anything that may or may not support their decision to continue purchasing an item.
The Bidding Process
The process starts with the auctioneer setting an amount for the bid. These bids can value higher than the base price, known as rises. The bidders may offer their alternative prices as a rise, which the auctioneer can choose to accept or not. The auctioneer has power over the bidding process, and this requires them to carry out certain activities:
- They can refuse a bid at any time during the auction
- They are also allowed to resume the auction at the last undisputed bid or start the bidding again
- Auctioneers can also offer/refer a bid to a seller and withdraw the same from the sale according to their preference