August 01, 2014
For many of us, the thought of bidding at a property auction is extremely intimidating.
Property auctions are competitive, the atmosphere is often quite tense and with property values rising year on year, many buyers are probably standing there wondering whether or not they have enough money to make the winning bid.
But while auctions can be intimidating for the uninitiated, we have created a few tips for you to follow so that those intimidating auctions become a walk in the park.
Prepare before the big day: Property auctions move quickly, and people who have not attended them in the past often get lost in the shuffle. If you have your eye on a property that is up for auction, it's a good idea to attend a few other property auctions beforehand to observe how the process plays out.
Keep your bids a secret: You may be tempted to let your high bid limit slip when chatting with a companion, the agent or other auction attendees, but it's important to keep this information a secret until you're actually placing the bid.
Consider hiring a bidder as your representative: If you are purchasing property for personal use, you may feel emotionally invested in winning the auction. Your emotions could get the best of you during the bidding process, with the end result being a lost auction or spending more than you had planned. Third-party bidders who have experience with the process can alleviate the stress of a property auction by bidding on your behalf.
Avoid overbidding: It’s easy to get caught up in the auction atmosphere and bid over your limit. But bidding more than you can afford will place you in a tight spot when it comes time to secure financing. Arrive at the auction with a limit and stick to it, no matter the outcome.
Understand auction rules: The rules of auction that are legally binding vary from one state to the next, so rely on a solicitor to advise on the legal implications of bidding on a property in your area. Here are some general laws that relate to most property auctions:
- Sellers are usually able to make one bid on the property. The auctioneer will announce this bid as a vendor bid. Some states allow sellers to make more than one bid.
- People who have not bid on the property are not allowed to say that they have placed a bid.
- Bidders are not allowed to disrupt the auction.
For further information, and to put yourself in the best position with valuable information and guidance, contact a trusted consultant from Mortgage Choice on 07 3286 7711.