Auction day can be nerve wracking and exciting, especially if this property is ‘the one’! Things happen quickly at auction so it’s important that buyers are well prepared and have a plan in place to help stay cool under pressure. The auction day game plan is really a number of tactics that allow you to stamp your authority on the auction and leave the impression that you know what you’re doing.
Do your homework & research comparable property sales
Before purchasing a property, it’s important to have done your homework. Attend as many open inspections of the property as possible, follow other properties for sale and get a true feel for the local market over a number of months. Paying 5% more than you need to may not sound like a lot, but consider all those extra weeks you need to work to pay off that extra amount on your home loan.
Do your due diligence
It’s good practice to thoroughly read the contract of sale ahead of auction day and ensure you ask all your questions prior to the big day. You might want to consider paying a smaller deposit or requesting extended settlement terms, however these details need to be pre-arranged with the agent in advance. If you’re unsure of anything, contact the agent, they’re there to help and experts in the field.
Set a pre-auction budget
It’s important you set a pre-determined limit on your bidding when you are calm, rational and can determine a realistic number and be sure to stick to it! Think about this limit and then come up with an unrounded number. If you can, make your limit $503,000 as opposed to $500,000 or $626,000 instead of $625,000 etc, other buyers will tend to think in terms of round numbers and you may have an edge over them.
Stand at the front so you have a birds-eye view of your competition and the auctioneer
Be visible and ask a question at the start of the auction. Don’t hide behind a tree or in amongst the crowd. Assert your presence and let people know you are ready to participate, confident and experienced. Always keep other bidders in your sights and follow their body language. Also, greet agents by name and refer to them and the auctioneer by name during the auction process. This will show other bidders that you are a serious contender.
Start with a strong first bid and then bid up in large increments
Get involved early and be part of the action. Start to exert some influence over the conduct of the auction. If there are no other bidders, then you are in the box seat already!
Say the full bids not just the bid increment
Call out $651,000 instead of $1,000 so the other bidders know exactly what they are paying. Be sure to fully articulate your bids, clearly and confidently.
Record the bids so you don’t lose track
This is a great visual tactic. It reinforces that you are organised, experienced and on top of the situation. It also will keep you involved, even when you are not making a bid.
Keep calm and watch your body language
This is absolutely essential. You need to leave the auctioneer and other bidders with the impression that you know what you are doing.
Use a combination of knock out bids & break down bids to slow bidding
You might be at the upper end of your limit, however you need to try and control the pace and momentum of the auction by varying the scale of the bids. Try increasing the bidding amount from $1,000 to $5,000 to attempt to knock out the competition or if the auction is moving too quickly, offer a lower bid amount to what the auctioneer is asking for, for example bids in $1,000 increments instead of $10,000 increments.
Get someone else to bid for you to take away the emotion
An auctioneer can easily spot an emotional bidder so you may want to consider engaging a professional such as a Buyer’s Agent or Advocate, or at least someone independent to bid on your behalf. Consider your limit and advise them accordingly in writing to avoid any errors.
Have some fun!
Don’t be too serious! The most important thing to remember is to keep within your budget and be prepared to walk away. Remember, there are always new properties coming on the market.
It’s spring, therefore the property market is booming! Dowling Mayfield have 2 very unique properties coming up for Auction in the month of September 2015.
53 Woodstock Street Mayfield and a unique development 1050m2 block at 288 & 290 Newcastle Road North Lambton, if either of these properties interest you please contact the selling agent Joe Di Claudio on 02 4960 0499.
If you click on the ‘buyers’ tab at the top of this page you will find photos, information and auction details for the above mentioned properties.
We look forward to hearing from you and hope this blog helps in your search for your new home.