Buying At An Auction – 10 Myths About Winning The Successful Bid

Buying at an Auction? We bust 10 Myths about Winning the Successful Bid

If you intend purchasing a property at an auction, there are a few myths and facts that you should be made aware of that have surfaced over the past few years.

1. Hiding at the Back of the Auction Room

Instead, take a position where you’re visible to as many people as possible. Appear determined and confident throughout the process instead. This gives the impression that you intend winning the auction.

2. Not Bidding First

Chief auctioneer at Premier Property Auctions, Graeme Hennessy, states that you may as well bid before anyone else because you’ll seldom purchase a property on the first bid. “But if you’re there starting the process, then experience shows us you’ll have a better chance of still being there in the end,” he said.

3. Bid High Early in the Auction

This strategy is sometimes effective, especially in cases where the bidder is determined to own the property in question and they’re aware of what it’s worth. The main reason why it’s effective is because it can take fellow bidders by surprise.

4. Not Following Advice on Auction Day

It’s essential that you take heed of your agent’s recommendations and advice during the auction campaign, particularly on auction day itself. Pay especially close attention to the property’s reserve price on the day.

5. Enquire during the Auction Whether the Property is on the Market Already

Damien Cooley from Cooley Auctioneers feels that this is a weak strategy because the property owner could get the impression that whoever asked could be a difficult buyer. This could result in them not actually wanting to negotiate with that particular buyer. In the end, it’s courtesy that they accept the highest bid; it’s not the law by any means.

6. Hang Back during Bidding

The sooner you start bidding, the quicker your competition will realise you’re serious about winning the auction.

7. Jump in at the End with a Massive Bid

Cooley said this strategy seldom works at property auctions. “The challenge with that is if an owner’s seen lots of competitive bidding, then they’re more likely to put the property on the market, meet the top price and sell. If there hasn’t been much bidding, they’ll probably pass it in. And then, an owner is much more inclined to negotiate with someone they’ve seen bidding,” he said.

8. When Someone Bids Against you, Bid Immediately Again

Hennessy says that you should always go in immediately with your counter-bid. It makes other bidders think you’re going to keep at it without stopping, which in turn causes them to quickly lose interest.

9. Have a Professional Bid on your Behalf

This strategy is often successful because it means that you won’t be overwhelmed by the emotions in the auction venue or get carried away and bid more than you can afford to.

10. State that you’d Like a Longer Settlement to give the Vendor enough Time to Vacate

This strategy is seldom effective, especially towards the end of the year, because vendors tend to want to settle deals before Christmas in order to avoid having to pay land tax.

Keeping these points in mind when attending your next auction will help ensure that you obtain – and retain – the upper hand.

Leave a Reply

Your email address will not be published. Required fields are marked *