Be “Professional Ready” to Bid At Auction
Auctions are fun to watch and can be quite the spectators sport. Since the property hit the market, momentum has built to this pivotal climax of crowds, tension and big money.
Therefore, if you’re the one in the hot seat the atmosphere can be anything but fun! With the vendor’s professional team of agents and auctioneers circling, it’s easy to freeze or let your adrenaline lead to dangerously impulsive decisions. All too often, pre planned strategies fly out of the window, which is exactly what the auctioneer depends on.
The good news is, there are many things you can do weeks before auction day to calm those nerves, build your confidence and give you more control. However, let’s start with the big day.
Auction Day Strategy
If you’re about to bid on a property you have your heart set on you must set yourself up for success with a strategy. Follow these simple yet key things so that you leave the auction a winner:
Stick to your budget
Whether family home or investment, you must set your budget before you start bidding and then you must stick to it. With this set in stone you won’t over pay and it will also free you up to bid confidently until your last dollar. If you start hesitating and whispering to your partner or friend you may as well shout out to the crowd that you’re out of money.
Ignoring this rule can turn your dream property into a financial liability and ultimately a nightmare.
The early bird gets the worm
Arrive early to watch how interested other potential buyers are so that you know who your competition is. Also, find a sneaky spot to watch how many people actually register to bid.
Be in control of your emotions
You may feel like this
but you must look like
At an auction emotions = money.
No matter how good the auctioneer is or how invested you are in the property keep things in perspective. If you exceed your well researched limit one or both of the following could happen.
People often ask me, “should I bid from the start of an auction or wait until the reserve has been met?”
There is no right or wrong answer here. It depends on many things such as:
One thing is for sure, if the reserve price (what the vendor will sell for) hasn’t been reached, then the property isn’t truly for sale. Having said that, if no one bids, how will the price nudge up to reach the reserve? Showing your hand may push the price up but as long as you’re within your budget and you know you’re not overpaying, does that really matter?
Keeping your eye on the prize as apposed to getting confused by politics is a must when under pressure.
What’s important is what happens at the end of the auction. Putting yourself in a position of power, while working with the auctioneer can make it easier to control the crowd and intimidate other buyers.
Yes, it may mean there’s more attention on you but better that than no one seeing you as competition. If you’re bold enough:
Control the auction and the other buyers!
Never bid against yourself
This may seem like a silly rule, but it’s really important! If you are new to auctions, then your emotions will run high and the auctioneer will have no problem putting pressure on you to bid against yourself. This is not okay.
If the bid sits with you, say nothing until someone else bids or the property is passed in. Keep your hands in your pockets and you may just find yourself negotiating post auction and buying a property.
Best of luck!
New Road Property