A House, A Home
When I was in primary school, and my parents spoke about things like Mortgages and Insurance and Superannuation, it made me wonder when I would start learning how to do grown-up things like buying a house. Was it part of high school? Or university? How did they work it all out before Google?
We’ve been looking at houses for three or four months now – we’ve even bid on a few at auction. There was one we really wanted but someone else really wanted it more than us, thwarting every effort we made to make it ours. I think you should probably really want any house you bid for, but there were some Simon just practised on (apologies to the people who actually wanted to buy those places). You can read about auction techniques on countless websites, but we found the best way of learning about them was to go to them.
We didn’t hire a luxury vehicle and park it out the front to intimidate other bidders, as one site suggested. We didn’t even “dress like we could afford the place”. We just watched people as they inspected a house, muttered to each other in the laundry, and chewed their lip when the bidding got too high. And they always got too high – one place we had our eye on sold for more than $200k over the advertised range. It gives you little faith in the numbers and even less in the agents, but the more you attend, the more you learn about the process and the better you can predict the outcomes.
When we walked into this property on Waratah Street, we could immediately see ourselves living there. Sure, there was work to be done but the location was ideal and the price seemed reasonable. We wanted to avoid an auction so we decided to submit an offer at the upper end of the price range, thinking it was a fair price and assuming with all our local market knowledge that it would go around $30-50k higher in a bidding frenzy. The vendors received a second offer, both above the reserve, and the agent called a ‘boardroom auction’. Yet another learning experience.
Unlike the emotional rollercoaster of a crowded footpath on a Saturday morning, a boardroom auction involves just those parties with an acceptable offer, in a room at the agent’s office, duelling for victory. There’s no guessing who’s serious and who isn’t, and no dramatic time-wasting techniques on behalf of the auctioneer. Ours was the highest offer, so the other party bid first.
In a move I think should be illegal, they raised us by $500. So we matched it. $500.
And again, and again. For $11,000 we played ping pong like Forrest Gump, until they gave up and we won. We had survived the game and avoided a circus and in 60 days we’ll be holding the keys. In the meantime, we’ll be learning how to Apply for a Mortgage by being thrown into the deep end. So far the bank is doing a good job of being patient while we compare Standard Variable Rates with No Fee Loans and Special Economisers.
I think this journey is worth recording, and this blog is where I’ll do that. There’s a lot of work between the Before and After but between an architect and a colour-crazed photographer I think we’ve got things covered. We’re starting from the ground up, and this is ground we’ve got to work with.
Have you bought a house at auction before, and lived to tell the tale?