Considering participating in an auction can really give you butterflies in your stomach like you’ve never experienced before. The thought of bidding with an overwhelming amount of money to secure your dream home in what is sometimes a matter of minutes, is sure to raise your anxiety levels just a little.
As you should already know, property auctions aren’t to be taken lightly. Be sure to do plenty of prior research and calculation before making any decisions.
The key to ensuring your emotions don’t take too much of a whack, and experiencing a successful auction participation is preparation.
So let’s look at four tips that will help you have a smooth, stress-free auction day.
1. Jump the gun
One handy tip is to jump in first with an opening bid. Yes, that’s right, open the bidding! As frightening as this may sound, it can deter other bidders from continuing or even starting as this is a method of cutting off their emotional attachment to the property right from the beginning. The sense of ownership comes from actively, but positively bidding.
2. Use odd numbers
When bidding at an auction, not just for property but for most other types of auctions as well, increase your bids in odd numbers. The calculation of odd values can confuse auctioneers, and in some circumstances, can slow the bidding process down. Your competitors may also be caught a little off-guard, stunting their momentum, forcing them to rethink their bids or cease bidding altogether.
It’s crucial to begin, and maintain an aggressive bidding approach. Always remember there can only be one winner, and you will only get one shot at this. If this particular house is the one you want, get bidding and don’t miss out!
3. Hold back
This tip may seem like it contradicts Tip No.1, however holding back with your bids at a property auction can also work wonders in your favour. Step back and let the other participants do all the bidding initially. Let everyone else become emotionally attached in the purchase and wait until the auction is coming to an end. Now, place your bid!
This will be the point in time when your competitors have usually reached their budgets or exceeded them, and where the level of interest begins to significantly decline.
4. Research, research and research some more
Never avoid the homework and research aspect of buying property, whether you plan to purchase through an auction or not – this cannot be stressed enough!
A thorough understanding of real costs, expenses and values prior to any bidding or inspecting is an absolute no-brainer. Analyse data such as trends and growth rates, rental returns and yields, and undertake price comparisons with dozens of properties first. No one wants to overpay for a property, and the only way to avoid it is to acquire the knowledge yourself to make better-educated decisions.
Always know your limits and set a maximum bid price for yourself as well, but also remember to enjoy your auction day and of course, happy bidding!