4 Guidelines For Buying At Public Auction
31 October 2014 Badenoch Real Estate
Most buyers are nervous about buying property at auction. In many areas, the majority of property is sold this way, which means buyers end up with little opportunity to buy without bidding. But the skills for bidding at a Public Auction can be learned and even practised, so buyers can get themselves ready to bid by observing auctions in progress and following a few useful tips.
- Get some experience
Go to a few auctions as an observer. Stand in different positions and determine where you can best be seen by the auctioneer and at the same time you can see other bidders. Work out who you might be bidding against if you were actually buying, and observe their body language. Couples especially express a lot of emotion in their stance, exchanged looks and other body language. It is possible to ascertain when people are reaching their limit by the increase in their anxiety levels.
- Learn Not to Show Emotion
A public auction is by very definition – public! You may be watching out for other buyers’ signals but make sure you that if you intend to bid, you aren’t giving away any signals of your own.
- Do Your Homework on Prices Thoroughly
Naturally those who have researched recent sales and have a good handle on property values are likely to feel the most confident when bidding time comes. They will be confident about how high they can bid and more easily console themselves when missing out on properties that go above market value. Conversely they will know a bargain when they see it. Set an upper price limit before you go in to bid on a property; having a range makes it easier, with your ideal price at the bottom and your limit at the top. You can even practice bidding by putting in opening bids or low bids on properties that you know will go much higher. (Don’t end up being left holding the baby though if there aren’t many bidders in the room!)
- Get Someone to Bid For You
If you’re really keen on a property (especially if you are an existing tenant or could in some other way be known to the agent or vendor as someone with a special interest and likely to pay top dollar) take the heat off by getting someone to bid for you. You can use a friend or engage the services of an appropriately qualified and professional agent (not someone working for the agent who is selling the property of course!) with whom you have a good rapport.
While auction is often accepted as the way for vendors to achieve the highest price for their properties, buyers who have done their homework can often make good buys when there are forced sales, especially in a buyers’ market.