Buying property at auction is very different to that of a private sale with the latter usually a less stressful process.
However, sales agents and vendors generally prefer auction sales as they can drive the property price higher and faster.
Buyers may also prefer auctions as they can see the competition around them and get a true indication of what others are prepared to pay.
Regardless of preferences, buyers heading to auction need to have all their ducks in a row – including finances and building and pest inspections – before raising their hand.
Why?
Unlike private sales, there is no cooling-off period at auctions, so if the buyer’s bid is successful, they are legally required to purchase it even if they can’t afford it or if they change their mind.
Successful buyers also need to pay down the deposit on auction day and sign the sales contract.
So, you need to set your auction strategy and financial limit beforehand – and stick to it.
Auctions are highly emotional and unpredictable events. For buyers bidding for their dream home, it can be tempting to get carried away in a bidding war.
It’s vital to bid confidently and wisely. Don’t be afraid to be bold and be the first buyer to bid.
Buyers don’t need to follow the auctioneer’s suggested bidding increments.
Smaller increments and especially unusual ones like $1,075 will force the auctioneer – and other bidders – to slow down as they’ll have to consider the more challenging maths of such bids.
Another good tip is to read the crowd and not portray your own emotions. Wear a poker face. Other buyers’ body language will betray their emotions. You should also discuss options with partners or friends quietly, ensuring other bidders cannot hear. Of course, be polite and professional when dealing with other bidders and the auctioneer.