If you have your eye on an ideal property that is going to auction soon, this article is for you. It’s no secret that property auctions can be very exciting and exhilarating occasions. And though a quick loan approval and some luck may go a long way, here are some useful tips to help improve your chances of winning at an auction.
Chris Kennedy, Harcourts New Zealand National Auction Manager, advises that you bid quickly and confidently since it is one of the most effective ways of winning at an auction.
According to Chris, bidding confidently and without hesitation shows other prospective buyers that you are a serious bidder. He adds that hesitating will only end up costing you more.
The trick lies in being bold, being loud, and being seen.
You are at liberty to ask the auctioneer as many questions as possible, both before the start of the auction and during the bidding process. Having worked closely with both the agent and the seller throughout the period before the auction, the auctioneer is well informed to answer your questions.
Besides bidding confidently and without hesitation, you also dress the part on the day of the auction. You definitely want to create a certain perception if you are to succeed. Dressing smartly usually gives the impression that you are serious bidder with the resources to afford the property.
Chris suggests that you can also choose to dress casually or in a non-descript way if you are not looking to publicly display your ability to purchase the property. How you dress will mainly depend on your strategy.
Think about attendance
According to Chris, while attending an auction with the family is often considered unwise as it can be distracting and may give the impression that you are likely dealing with other pressing financial commitments, it can actually prove to be advantageous in some cases.
He recalls an auction he attended where there was a young couple bidding alongside a young family. And at one point, the young couple stopped their bidding after realizing that the young family actually needed the home more.
Get your finances in order
One crucial thing to note about auctions is that you need to have a cash deposit (of about 10%) at hand in case you are successful in your bidding. It is thus important to ensure that your finances are in order. You also need to seek pre-approval beforehand to ensure that you know exactly how much you can comfortably and confidently bid.
Do your due diligence
Ensure that you’ve done your due diligence before the auction day. This includes organizing all the necessary building and pest inspections, and conducting the relevant title search.
This will help to give you a sense of assurity, helping you to confidently bid on the auction. Given that sales at property auctions are final, and contracts are typically unconditional, you won’t have the chance to arrange for relevant inspections once the auction is over.
Understand your limits
Before heading to an auction, you first need to determine the maximum you are willing to bid. However, it is important to note that a difference of $1,000 can cause you to miss out on your dream property. Take into account the investments beyond the property itself, consider surplus equipment to save on renovations.
Auctions can be both a nerve-wracking and exciting experience. It is therefore crucial that you make prior arrangements, figure out your limits, and bid confidently on the auction day.