The moment it passes in
In NSW, if the reserve is not reached during bidding, the auctioneer will privately ask you whether you will sell at a lower price. If bids still fall short, the auctioneer seeks more, and the property may be passed in or withdrawn from auction. Victoria’s page for sellers describes the same two outcomes.
Queensland’s page for sellers puts your position plainly: you do not need to accept the sale if bidding did not reach your reserve, and you may choose to negotiate with a bidder.
Who you negotiate with first
Here the states part ways. Each branch below is one state’s rule.
Victoria: the highest bidder, first
If the property is passed in below your reserve, the auctioneer must invite the highest bidder to negotiate with you before offering it to anyone else. Victoria’s page for sellers adds that this first right holds even if the property was passed in on a vendor’s bid. The auction rules in the regulations say the same: you first negotiate with the highest bidder.
After a pass-in below the reserve, the auctioneer may decide whether to take late bids, but only after that first negotiation. If no contract is signed after the auction and you choose to offer the home for private sale, late bids can be referred to you, and your agent must pass on all offers unless you tell them not to.
Western Australia: private negotiation
Consumer Protection WA says that when a home is passed in for missing its reserve, the auctioneer or agent can negotiate privately with bidders. Its page for sellers adds that the auctioneer may act for you in private talks with the highest bidder or anyone else interested.
Northern Territory: a private treaty offer
The NT page says the highest bidder may get a chance to talk to you or your agent after the auction about raising their offer, by private treaty.
NSW and Queensland
In NSW the auctioneer asks you privately about a lower price; if the home is passed in, the highest bidder generally has the first opportunity to negotiate with you. In Queensland you may choose to negotiate with a bidder.
South Australia, Tasmania and the ACT are not covered in this part.
What may be said about the last bid
A home passed in on a vendor bid has a last bid that was made for you, not by a buyer. Four places say how that figure may be used once marketing starts again.
- NSW. If a home is passed in and the last bid was a vendor bid, an agent may not state its amount while marketing the property unless the statement makes clear it was a vendor bid.
- Victoria. If a property is passed in on a vendor bid, that fact must be stated in any of the agent’s advertising that gives the last bid’s amount, and by any publisher printing it.
- Tasmania. Where land is not sold at a public auction and the last bid was one the auctioneer made for an owner, anyone marketing the land who states that bid’s amount must also say it was made on behalf of an owner.
- ACT. Where a home is not sold at a public auction and the last bid was one the auctioneer made for the seller, neither you nor an agent may give that bid’s amount in marketing the home without saying it was a bid made for the seller.
What you still pay, and for how long
Consumer Affairs Victoria says that a property passed in and not sold afterwards to the highest bidder may go on to a private sale, or come off the market. Either way, you will generally have to pay the marketing expenses and the auctioneer’s fee, but not the agent’s commission.
The agent’s authority may still be running. In Victoria, an exclusive authority that states no period ends by default 30 days after the date of the auction.
A sale after the auction, and the buyer’s cooling-off
A contract signed after a pass-in can still carry no buyer’s cooling-off: in NSW, contracts exchanged on the same day as the auction after a pass-in have none. Each state’s window, before and after the day, is in auctions and cooling-off.