The thought of bidding at auction can be somewhat intimidating, especially with the recent interest from interstate purchasers bidding on the other end of a phone.
At auction, you can see who is interested in your dream property and what they are willing to lay on the line for it. If you love a little psychology, it’s an opportunity to read the crowd and fellow bidders to determine how interested they are or better yet when they may be close to their limit.
Real Conveyancing doesn’t want anything to deter you from purchasing your dream home, and that is why we have compiled another ever-trusty list of tips to help prepare you in the lead up to auction day!
- If this is your first rodeo, then it’s good to be prepared. Attending other auctions can give you a feel for what happens. You can also witness different bidding strategies and adopt one that might make you more comfortable.
- Know your market. Know the properties in the area and what they have recently sold for. With this information determine a “walk away” number.
- Zip the lip and play your cards close to your chest. Real Estate agents can be highly skilled in pulling information out that could be detrimental to your negotiations. Instead, play it cool and don’t reveal anything, especially that walk away number!
- Get your finances in order with an Unconditional Finance Approval which means your lender has agreed to loan you the money. You will also need to be in a position to pay your deposit on the day with a successful bid. Your deposit will be the equivalent of 10%. Find out how the seller will want to receive their sale deposit so that you can make arrangements beforehand such as obtaining cheques or other forms of payment on the day)
- Obtain a copy of the contract before the auction and have your conveyancing lawyer look over it well before the auction. Your conveyancer will be able to identify critical areas that may serve as possible risks and advise you accordingly.
- Ensure you have had your building and pest inspection with reports returned before auction day. No matter how much you love the house, it is essential to know what you are buying and what pitfalls may or may not lay ahead.
- Before auction day, register to bid with the agent providing all relevant identification. You will also need these on the day so make sure you have them with you!
- On the auction day arrive earlier than the designated time so you can have one last inspection and find a suitable place to stand. Find a spot where the auctioneer can see you and ideally, where you can see all the bidders!
- Be strategic in your bidding strategy. Auctioneers can often have some sneaky tricks to get the bids higher. Some say it’s best to wait until the property has reached its reserve to start bidding, while others suggest going in high and strong at the beginning. Either way, establish how you will be bid and do it confidently or enlist an experienced friend or Buyers Agent to bid on your behalf on auction day.
- Lastly, don’t be emotional. If the property is outside your budget, it wasn’t meant to be. It’s important to avoid impulse bids outside your budget. Stay calm, and in control, if you don’t win this property, yours can only be just around the corner!
Happy Bidding!