With so much confusing publicity about changes to auction rules in recent times, I have outlined below some valuable guidelines that will assist you in planning your strategy when it comes to bidding at an auction.
1. There will be no 'dummy bidders'..
You can be assured that all bids at a Darren Lockwood auction are entirely genuine and that our auctions are conducted with total transparency.
2. If a vendor bid is used it will be clearly stated as that..
The auctioneer holds the right to place bids on behalf of the vendor. This will only occur if you and the other bidders choose not to bid, and will only take place at a level clearly UNDER the figure at which the vendor will consider selling. Each vendor bid will be clearly declared as that by the Auctioneer.
3. You need to bid in order to buy..
It is advisable for you to bid during the Auction to indicate your interest in the property. Once a property has been declared 'on the market', the highest bidder will be the winner of the auction unless someone else places a higher bid before the auctioneer calls 'SOLD'.
If, however, the bidding does not reach the vendor’s reserve price, the property will then be 'passed in'. In this case, the open competition of the auction is then lost and the highest bidder will be offered the property at the vendor’s reserve price.
We’ve got some more handy hints on this topic, to make sure you’re fully prepared when it comes to bidding for your dream home.
4. Do your homework..
When it comes to buying property, there's no such thing as too much research. Speak to agents who know the area, find out what similar properties have sold for and explore the neighbourhood thoroughly. That way, when the time comes to bid, you know exactly what you're bidding for.
5. Get out and about..
It pays to attend as many auctions as possible before you start bidding. Watch how different auctioneers behave, and study the tactics of individual bidders. Not only will this give you some ideas on how to bid yourself, but also you never know when one of these auctioneers or bidders might be at the auction of the property you want to buy!
6. Determine your limit..
It is important that you set your own bidding limit. Decide what the property is worth to you, (not someone else), then having allowed a margin of perhaps 5% to 10%, try to stick to it.
7. Never stop on an even number..
Wherever possible, it pays to set an uneven limit, rather than stopping on a round number. For example, rather than stopping at $410,000, try going to $411,000. You may get a pleasant surprise as one bid can make the difference between getting the property of your dreams, or missing out on it.
8. Don't be afraid to ask for help..
Don't be afraid to ask a friend, relative or real estate agent, to assist you with your bidding. Many people ask someone else to bid on their behalf as they may be less inclined to bid emotionally and to stick to a predetermined limit. However, if they are going to bid for you, you need to make sure that they have very clear instructions on what they can and can't do on your behalf in order to avoid any mis-understandings in the heat of the moment.
9. Dress to impress..
It never does any harm to dress for the event. If you look like an affluent, confident property buyer, this will help convince your competition that you won't stop until the property is yours. Remember that it isn't always the person with the most money that wins at auction. It is always the person who convinces everyone else to stop bidding.
10. Check the paperwork thoroughly..
It is a good idea to have a good read through all the paperwork related to the auction beforehand. Wherever possible, contact the agent handling the sale and ask them to provide you with a copy of the documentation. This is normally possible in the week prior to auction. Read through all of the documents and always ask if you are unsure of anything. It is important to clarify details such as settlement terms, deposit and fixtures before the auction commences.. and not after it has been knocked down to you!
11. Be clearly visible..
Remember how an auction looks from the auctioneer's perspective. They are often looking at a large number of people who are invariably turning around, whispering, brushing away flies, shielding their eyes, etc. If you are standing at the back of this scene, or hidden in the shade of a tree, the auctioneer may well miss your bid, particularly when you are bidding for the first time. Stand in clear sight of the auctioneer and make your first bid obvious to them.
12. Be decisive with your bidding..
Make sure the auctioneer understands what you are doing. Bid early, clearly and confidently, and avoid unusual sign language that may be mis-understood.
13. Maintain control..
If the bidding is increasing in larger denominations than you are comfortable with, consider offering a lower denomination as your bid. The auctioneer does have the right to refuse it, but there is absolutely no harm in trying.On the other hand, don't be afraid to try and increase the bidding with a "knock out" bid if your competition is showing signs of slowing down. This can often throw doubt into the mind of the other bidders and get them to stop even though they have not yet reached their limit. Good luck in your bidding and remember, the staff of Raine & Horne Kawana Waters are always happy to assist you during our auctions should you need it-? Feel free to ask at any time. |