Property auctions can be daunting, especially if you are new to them. It’s easy to let emotion and excitement get in the way. This is why it’s important to be prepared if you are attending an auction so that the day turns out as planned.
Auctions are an excellent place to get some great deals on property, especially in the current climate. If you make sure you are prepared and know how to act on the day, you can secure that excellent property investment you are looking for.
Make Sure That You Know The Rules And Regulations
There are different rules that apply to different states, so you need to read and understand the rules that apply in your state before you attend the auction. There are some property auction rules that apply throughout Australia.
- There is no cooling-off period applicable to property auctions.
- Any attempt to raise the bidding with fake bids is illegal.
- Once the bidding reaches the reserve price, the property is then officially on the market.
- Anyone who makes the highest bid can negotiate with the seller if the reserve is not reached.
These are some of the rules that you need to be aware of.
In addition to knowing the rules, you need to make yourself aware of the process for the auction you are attending. These terms will be read out on the day, but it’s useful if you prepare yourself before you attend.
Do Your Research
It’s a big help if you have some experience and knowledge of the auction process before you bid on a property. This is why research is so important. Vendors and agents hire auctioneers to conduct the auction; you can find out more here. If you know which auctioneer is conducting the auction where you want to bid, it helps to attend other auctions where he or she is involved beforehand, so that you know what to expect.
As well as researching auctions, you also need to research different properties. Fully understanding the condition of, and other information about, the property helps you to determine the highest price that you are willing to pay.
Have A Deposit In Place
It’s important to remember that you need to have the ability to pay the deposit for the property you have purchased, on the day. This deposit is usually around 10% of the purchase price. If you are not able to pay this deposit, you will be non-compliant with the terms and conditions of the auction which could threaten your purchase.
How To Behave On The Day
If you want to be successful in your bidding at a property auction, it’s important that you understand how to behave.
- Arrive at the auction in plenty of time, so that you can get the measure of competing bidders.
- Exude an air of confidence and make it seem as though you have endless financial resources.
- Be quick and assertive when you bid.
- Do not exceed your “walk away” price. If you have done your research, you know how much you are prepared to bid and bidding higher than this is not a good idea.
Being successful at auction is not always about getting the property you are bidding on. It’s about understanding the market and the atmosphere at the auction and making decisions based on research and knowledge, not emotion.