Purchasing a home through auction can be an exciting experience but it may also lead to frustration. Having a plan is an important first step towards succeeding at your goal of purchasing your ideal home. Included in that plan is doing due diligence, it is always best to speak with an expert and make sure you have your financing squared away before setting out. Oak Tree Finances is an independent mortgage broker with over 15 years of experience. Our specialists are here to help you and always place the customer first, call us on 0404 403 066 or continue reading to learn more about how to win a property auction.
Keep your budget in mind
A successful strategy regarding how to win a property auction factors in budget constraints. Knowing how much you can spend gives you peace of mind. It avoids placing you in a position where you may have to break a contract and incur legal action. Knowing the maximum you are willing to spend also helps keep you levelheaded during the bidding process.
A useful tip is to keep your budget written down somewhere. Make it easy to access and look at it occasionally to remind yourself when to slow down or stop the bidding. Consider keeping two sets of numbers as your budget. One that reflects what you want to pay and the other indicates the maximum you are willing to spend. Never exceed the second number.
Be mindful of the market
Research the current state of the market you are buying into. We strongly recommend paying for a pest and building inspection during the inspection period if this is not already available from the vendor. Look into past sales from the area you are considering purchasing in to get a sense of the prices. Take advantage of online resources. Query the real estate agent about the seller and other buyers.
Make a list
Determine what you desire and need from a property. Crosscheck this list to the property you are considering purchasing. This can help ensure that it is a good fit for your wishes.
Bidding
Keeping your emotions in check is an important step when thinking about how to win a property auction. Knowing when to bid is an art, not a science but it is an element of a successful strategy. Be confident and brush aside sales techniques the auctioneer may use. Do not be afraid to increase the size of your bids as this may help deter other buyers from continuing to bid or if the biding is increasing too quickly then increasing in smaller increments can sometimes slow down the process. Take part in other auctions to gain experience. Simply watching and observing can help you make wiser choices.
Get to the point
Auctions may seem to be fun, which they can be, and games, which they are not. The point of an auction is to purchase property you can afford successfully. Do not linger. Do have conviction. Be tactical when placing your bids but avoid dragging the process out. You want to minimise other buyers’ interest so you can place the winning bid.
Know the actual price
The price of a property is never listed for an auction. It is good to have a clear idea of what you feel is the market value of the property based on similar recent sales in the area. The only way to get this is by doing your research in the local area. This should start online but it is also important to inspect as many properties as possible in the local area and observe the selling prices. This will give you a clear picture of what you feel is the market value and help you set an approprioate budget. Fear of missing out drives people to push up prices. Keep your budget in mind and do not be afraid to lose.
Hire a professional
Bidding on auctions can be stressful, exciting, and creates a lot of pressure. If you are not comfortable in these sorts of situations, consider hiring a buyer’s agent to handle the process for you. Their expertise can help lead to a successful bid.
Interested to Learn More?
Oak Tree Finances are here to help you secure your home. Based on the Gold Coast we provide personal mortgages, finance, and business investment brokerage services. If you are ready to commit to buying a house, get in touch with us on 0404 403 066 or contact us online.
* This content is intended as general advice only and does not take into account an individual’s circumstances. Please do not act upon any of the information contained here within without speaking to your home loan broker or independent mortgage broker beforehand.