9 tips to help you win at an auction.

Spring time is buying season. And buying a property at auction can be incredibly stressful, but that stress can be minimised by being prepared and following some important tips:

1.       Ensure that you have pre-approval for finance before bidding. This is vital. Contact me to arrange pre-approval before you start looking. This will help you proceed with purchasing a property with confidence. It will also help you set your budget.

2.       Set your budget and stick to it! Auctions are designed to be fast paced and competitive to push up the bids, as a result, you can quickly find yourself bidding beyond your budget. That is why setting an absolute maximum budget and sticking to it no matter what, is critical.  As an extra tip, don’t disclose your budget.

3.       Do all your checks and balances. Get building inspections and pest inspections done.  Send the contract of sale and vendor statement to your solicitor to read over before bidding. Doing all of your due diligence will minimise the risk involved when signing the paperwork. 

4.       Know what the property is worth. We provide our clients with free property reports to help them understand the true worth of a property.  Getting your hands on these reports means you’re less likely to over bid. 

5.       Determine your bidding strategy. Attend other auctions and watch how the auctioneer uses techniques and strategies to get the buyers to keep bidding.

6.       Observe body language. When you attend an auction, project confidence right throughout the process.  Also, watch other bidders - look for signs that they might be approaching their limit such as hesitation, having in-depth conversations mid-auction with their partner or agent or making a phone call.

7.       Set or change the pace if need be. There are different schools of thought on whether to go in high early or wait to see what others do but irrespective of your overall strategy, know that you can set or change the pace during the auction if necessary.  Increasing by smaller increments, or bidding on odd increments and can confuse the competition and throw them off their game, it also slows momentum of the auction while the auctioneer adds up the numbers which can take the heat off a little and you don’t find yourself swept up in it all. 

8.       Avoid the ‘knockout bid’ trap. Avoid last minute panic or placing a large final bid to secure the property.  It might seem like a winning strategy but you could find yourself pushing the final price far higher than what other buyers are willing to pay, leaving you paying more than necessary. 

9.       Don’t forget, stick to your budget. We’ve already mentioned this one but it is so important it’s worth a second mention.  Stick to your budget!  No good comes of going over, you may find yourself bidding more than what the property is worth which can affect your ability to secure finance or you may just big higher than what you can borrow, leaving you in a terrible position.

If you’re a first home buyer, I’ve created a useful guide to help you understand key aspects of buying your first home, you can download a copy here.

I can also help you obtain a free property report to help you understand the value of the property you are interested, which could give you an edge at an auction.

Remember, a critical aspect to your success is securing your finance and obtaining pre-approval.  To obtain pre-approval, get started today.