Bidding on a property at auction is a nerve-racking experience, especially if you have your heart set on buying it. The competition intensifies, emotions rise, and everything happens too quickly for cool thinking. That’s why it’s important to prepare yourself by making a game plan on the auction day. This will ensure you buying at auction for a fair price, or avoid buying at all. Below, we have pulled together some pointers to help you on the big day.
1. Arrive early
Arriving early gives you an opportunity to position yourself towards the front of the auction, preferably near the auctioneer. Being in front also gives you a better view of your competition so you can see who you are bidding against. This also lets people know that you’re confident, experienced, and you’re prepared to bid.
2. Don't bid until the property is "on the market"
Never bid until the property reaches its reserve price. If the auctioneer hasn't said anything, don't be shy about asking mid-way through the auction "is the property on the market." Until then, it is not for sale and you are just increasing the hype around the property and building the price. No matter how much pressure you receive from the auctioneer, do not play into their hands by bidding too soon.
3. Call out your bids in full numbers
Don’t call out your bids in increments, like “$1,000”, instead you should state the full amount “$501,000” this way your competitors know the exact number they're bidding against. Be sure that you fully articulate your bids confidently.
4. Slow the bidding
Slowing the bidding is a strategy you can use to stay within the limit of your auction budget. If the auctioneer calls out for $5,000 bids, you can offer $1,000 or $2,500 so that the momentum is slowed.
5. Don’t get emotional
If you know you can’t handle the emotions and the stress of property auctions, you can have a buyer’s agent, friend, or a family member who you can trust to do the bidding for you. You can advise them of your game plan and tell them your price limit.
Using the right strategies can reduce the price you pay on auction day but to bid with confidence you need to be well prepared. Do your research, inspect the property, have your home loan pre-approved, and make sure you have enough money to supply the deposit on the day if you win.