AUCTION TIPS & FACTS

Some straight talk about auctions

Knowledge is king

Go to a handful of auction and listen to the language people are using. You’ll quickly see how important it is to have even a bit of knowledge. You’ll also be exposed to the commonly‐ practised tactics to watch out for. If bidding at auctions wasn’t a skill, professional bidders and buyer’s agents wouldn’t exist. Walking into auctions cold can be dangerous and unforgiving.

Underquoting is common practice

Underquoting is one of the biggest hurdles you need to overcome when searching for a property. Too many people become emotionally attached and financially invested (wasting money on building and pest reports) in properties they simply can’t afford. So remember: agents routinely underquote property prices by about 20%. This means if they quote $500K and you cannot afford $600K, walk away.

Pre‐approval is a smart idea

Secure written pre‐approval from your lender before the auction. Once you know what the bank is willing to lend you, you’ll be able to set your limit with confidence. You’ll also be able to work out how much your repayments will be if you’re successful.

Homework matters

Before an auction, get to know the market you’re buying into. It will help you determine your budget and where to set your limits. Also study the contract and condition reports and organise building and pest inspections well before auction. And if you’re planning a renovation or redevelopment, know the approximate costs to ensure you have funds left after the auction hammer falls.

Confidence is key

Confident bidders are in control at auctions. They take their time. They bid firmly. And they’re not intimidated by auctioneers or competing bidders. But be careful not to go overboard either. Everyone likes to be the ‘winner’ on the day, which makes it easy for our hearts – or egos – to rule our heads.

Valuations are worthwhile

Engaging a professional valuer can cost a few hundred dollars. But it can save you thousands. Once you know the value of your property, you can work out your ‘walkaway’ price. And if bidding goes above that figure, you’re out. No ifs. No buts. For example, your walkaway price may be the property’s value plus 5% ‐ a small premium for the emotional attachment to your future home.

Why take chances with securing your dream home?
Call me on 0407 642 662 to learn more about my professional and affordable auction bidding service.

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