The Answer
Auction: no cooling-off | Private: 5-day cooling-off
Know the difference before you bid. Auctions are final — there's no going back once the hammer falls.
Key Differences
| Auction | Private Treaty | |
|---|---|---|
| Cooling-off | None — the contract is final | 5 business days (most states) |
| Deposit | 10% on the day (usually) | Negotiable (0.25% to 10%) |
| Building inspection | Must be done BEFORE auction | Can be done during cooling-off |
| Finance | Must be pre-approved | Can be subject to finance |
| Price | Transparent — you see other bids | Negotiation — you don't know other offers |
| Speed | Done in one day | Can take days to weeks |
Auction Tips
- Get building and pest inspections done before auction day — there's no turning back
- Have your finance fully pre-approved (not just pre-qualified)
- Set your absolute maximum and do not exceed it in the heat of the moment
- Register to bid — you'll need ID on the day
- The vendor bid (auctioneer bidding on behalf of the seller) is allowed in most states — usually once
Frequently Asked Questions
Can I back out of an auction?
No. When the hammer falls, the contract is binding. No cooling-off period. You must pay the deposit on the day and settle by the agreed date. This is why you must inspect and arrange finance before auction.
What's a vendor bid?
A bid placed by the auctioneer on behalf of the seller. It's used to move the bidding along. The auctioneer must announce it as a vendor bid. Usually only one is allowed per auction.
What Changed
Apr 2026
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