Here’s an overview of the different ways you can buy a home – for a more detailed explanation see our Making an offer section.

Offer and negotiation

• This is historically how most New Zealand homes are bought and sold, and remains a very popular method (particularly outside the main centres).
• The home is advertised at a set asking price or a price range.
• You can put in an offer at or below the asking price – typically below, because some negotiation is usually expected.  Your offer can include conditions, such as a satisfactory valuation report.
• The seller may accept your offer, reject it, or make a counter offer
• Negotiation can include price, conditions, or both.
• The real estate agent acts as the go-between for buyer and seller until an agreement is reached. 

Auctions

• No price is set.  Interested buyers simply turn up on the day and bid for the home.
• The seller sets a minimum or ‘reserve’ price (which is not divulged to bidders).  Once the bidding reaches the reserve price the property must be sold to the highest bidder.
• Once a property is sold at auction the sale is unconditional and legally binding – so you must have your finance approved, carry out any inspections, valuations, etc. beforehand – once the hammer falls it’s too late to change your mind!
• If the bidding does not reach the reserve price the property is ‘passed in’.  The highest bidder is then given first chance to negotiate for a sale.

Tenders

• No price is set.  Interested buyers submit written offers, which may include conditions. 
• Bidders do not get to see the other offers
• All tenders are opened at the same time, and the seller considers them.  They do not have to accept the highest or any offer
• The seller may choose to negotiate on any of the tendered offers
• If your tender is successful you will need to pay a deposit to the real estate agent immediately to secure the house – so you need to have funds for your deposit readily accessible and the rest of your finance sorted.

Private sales

• Private sales almost always use the offer and negotiation method. The difference is you will be dealing directly with the seller rather than through an agent
• Private sellers may advertise in newspapers, through private sale websites or other methods including mail drops in the local area.

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