A recent post looked at the steps you could take before attending the auction of a property in which you were interested. Pre-planning is essential, especially with regard to your finances. On the day of the auction, it is also important to go in with a plan.
On the day of the auction arrive early. Look through the property again, talk to the agent, but also take note of the other people who are there. The neighbors will no doubt come out to see the auction – they want to know the property prices of their street – but they will not likely attend until closer to the auction’s starting time.
The other ‘early-birds’ are likely to be interested in buying the property, so it is important to know your competition. Particularly take note of anyone who is inspecting the contract or asking a lot of questions to the real estate agents. The agents will be aware of people interested in the property so watch for anyone who, as they arrive, are approached by the agents.
It is unlikely you will have no competition – and take note, that this is in a sense a competition – so you need to look and act like ‘the winner’. Be confident in your bidding. Having done your homework before the auction (see the last post) you will have an idea a likely reserve. Open the bidding high – close to where you think the reserve will be.
Make sure other bids you make are done quickly and be loudly assertive. The longer you take to consider a bid, the weaker your position will look. One good strategy is to say the complete price of your bid, not just put your hand up or add the increment. This is a reminder to all bidders of what you are willing to pay – $615,000 reinforces that your competition have to find more; just saying $5,000 takes away the psychological impact of your bid.
Of most importance – stick to your price plan. Be prepared to stop bidding if the price has gone above your limit. You know what the property is worth to you – don’t let the emotion (or adrenalin) of an auction cause you to over-commit.
It is worth noting that, if the reserve is not met and the property is going to be passed in, having the top bid is an advantage as you have first right of negotiation with the seller. This is especially important to keep in mind in a cooling property market in which there is a price correction occurring.
The other thing worth noting is that you don’t have to out yourself through this stress – there are people to help with your property purchases. Accrue Real Estate have years of property experience and are ready to help you navigate through the process.