Auction Strategies: Tips for Buying at Auction
Many buyers ask me 'Shannon why do you do so many auctions'? I can understand their fustration as buyers just want to know where the vendor is sitting in terms of their price expectations. Most vendors understand that the value of anything is only what someone is prepared to pay for it. The value of an item then comes down to supply and demand. With the property market in Manukau still very hot and in demand it does push prices up hence why I feel auctions are the best method to achieving vendors a top sale price.
There are ways you can set yourself up for success though. Good agents will ask buyers prior to the auction if they need assistance at the auction and talk strategies. Here are a few tips to take away with you...
- Give strong and confident bids, making eye contact with the auctioneer. If you are not confident, ask a family member to help or the real estate agent. The larger your bids the more stronger you look in the arena.
- Bidding amounts will increase at various levels depending on the value of the house and will be at steps chosen by the auctioneer. But you can offer a lower bid if you like and remember to leave some 'fighting' money at the end. Know your limit and stick to it.
- If a house doesn't reach reserve it will be passed in. The highest bidder is then given the first opportunity to negotiate the sale, so try and be the last bid.
- An auction is a cash sale, if you are the winning bidder, you'll pay a previously agreed deposit (usually 10%), sign the sale and purchase agreement, and walk away the proud owner of a new home - congratulations!