- Posted 17 Oct
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If you’re looking to purchase good investment properties in Australia, buying from property auctions might be a great way to start out.
If you’ve already made up your mind about investing through auctions, you’ve probably already found out the few simple steps you need to take pre-emptively – such as finding out whatever you can about the properties you will be bidding on, setting a budget for bidding and so on.
You must take these steps to cover all bases for when you start bidding for any investment property you’re interested in.
However, for first home buyers looking to succeed in getting their hands on a property, you might need to work a little harder to make sure it happens.
For one thing, no two auctioneers conduct their business the same way. Investment properties are expensive commitments. Whether you’re taking out home loans or refinance your mortgage, you should not step in without some preparation.
Here’s our list of top five buying strategies at an auction:
- Claim a prime spot. It’s really important that the auctioneer is able to see and hear you clearly from where they’re standing. Your ideal spot would be in the front row, as close to the auctioneer as possible. Failing that, always make sure to seat (or stand) yourself somewhere that is within their line of vision so that you’re easily visible to them. This way you can make the bidding exchange easier and remove any potential for misinterpretation for when you make a bid.
- Be as loud and clear as possible while making a bid. You don’t need to be polite by softly declaring the amount; at an auction you need to be visible and, if possible, notable to the auctioneer as well as to the other people competing with you for the property. State the amount you’re bidding distinctively so that there can be no misunderstanding, and make sure that you don’t lose your shot at buying the house you’re after through lack of communication.
- Don’t let anyone pressure you to make any decision you’re not comfortable with. Some auctioneers and real estate agents might appear somewhat overbearing; and some buyers might try to remove you from the competition by making you uncomfortable in some way. You should try your best to not let any of these circumstances push you to make any decision you’ll only regret later. Once you’ve done your research on the property and the price, you should be well armed with the knowledge of what will work and what won’t for your situation. Don’t get roped into making higher offers or pulling out of bidding unless you’re ready to.
- Start bidding after the property is “on the market”. Even after the bidding starts, until a bid reaches the vendor’s reserve price, the property won’t be sold. Wait till the reserve price is reached before you start bidding. You’re real estate agent should have this information handy for you.
- Weed out competitions that are only interested in bargains. You can find many of these people at an auction. The auctioneers engage them by starting the bidding too low so that others feel the urgency to begin bidding early. You can either wait till a sensible price is reached, or you can throw out higher bids to get things to speed up.
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