It’s easy to get swept up in the emotion of an auction, and why not? It can often be the culmination of months of searching for the right property for your needs, dozens of locations vetted, all to get you to this house. Whether it’s for investment, or a family home, auctions matter to you, which means you want to have every tool in your arsenal ready to go, to ensure your bid makes it through.
We’ve compiled five essential tips to ensure your auction success.
Tip 1: Preparation
Like almost everything in life, preparation cannot hurt your auction-day presence.
Ensure you’ve investigated the vendor’s reserve, and, if possible, have had a chat with the agent about how the prospects are looking so far. Before the auction, while everyone is registering, check out the competition and work out who is a serious buyer, and who’s just there to watch it all unfold. This information helps you work out who you need to focus on during the auction, not getting distracted.
Additionally, ensure you have your finance pre-approved, so you’re ready to set down a deposit, without having to make the vendor wait weeks for a sale that may not go through. Given this situation, a vendor is more likely to simply pass you over for the next best alternative.
If you’re new to the auction scene, go to a few where you have no interest, just to acclimate yourself to the way they work, and the way emotions heighten. In your auction, there should be nothing throwing you off.
Other checks to remember are property and pest inspections, as well as asking your solicitor to go over the contract and check for any discrepancies or surprises.
Tip 2: Confidence
One of the most critical parts of your auction strategy, the confidence you portray to other bidders influences their bidding decisions and the outcome of the auction.
It ties back to psychological dominance games: if you can assert yourself as the strongest in this field without doing a thing, you automatically make everyone else back off the prize you have claimed as your own. Other bidders will usually treat you as the ultimate winner, and, in a self-fulfilling prophecy, you’ll find you usually do win.
But how do you present this confidence?
First things first, think about where you’re standing. Hiding at the back, or on the side, not only means you run the risk of the auctioneer simply not seeing you, but also suggests to others that you’re unsure of yourself. Stand in the middle of the crowd, near the front, where you can be seen by everyone. This way, no one is in doubt who is making your bids, and you look like you’re not ashamed to be seen bidding, which you would only be if you thought your bids would be unsuccessful.
In addition, a strong strategy is to offer the first, or one of the first, bids. By getting your bid in early, you are proving you aren’t just a spectator, or half-hearted. You’re in this for the property and everyone knows it.
Tip 3: Respect
However, confidence is a very different thing from being obnoxious. Be respectful of the auctioneer, the other bidders, and the vendor. Heckling the auctioneer, making jibes at other bidders, and generally making a nuisance of yourself isn’t a great look. Not only does it frustrate the auctioneer, but it also damages any influence you had built through a confident demeanour.
If you make those around you feel uncomfortable, their feelings of respect are replaced by frustration and annoyance. Inherent in those latter feelings are a degree of contempt, which is the last thing you want people to feel for you.
Additionally, remember that if the property gets passed in and you’ve put in the highest bid, you’ll need to enter post-auction negotiations. There is, however, no requirement that the vendor entertain your bid if you’ve been unpleasant during the auction. They will be influenced by the agent’s opinion of you, and it’s worth your while to make a good impression.
Tip 4: Caution
If you have your finance pre-approved, you should know the limit for your bid. The key is to stick to this, amid the auction frenzy. It can be easy to rationalise exceeding your limit as acceptable, given just how perfect this property is.
It’s important to remember that part of what had made this property perfect for you in the first place was its ideal pricing: when it moves beyond that comfort zone, it’s no longer the perfect property.
It’s not a good feeling to walk out of an auction and realise you’ve overcommitted yourself and your budget. Far better to wait the market out, until something more viable comes along.
One way to ensure you keep your head during an auction is to hire a bidding agent, or to authorise someone to bid in your place. Both of these won’t have the emotional investment you do in the property, and, bidding with someone else’s money, will find any excess much harder to justify. Although this isn’t an option for everyone, it’s certainly worth considering.
Tip 5: Strong and Quick Bids
Although a specific technique, consider setting your first bid well above the starting price. This immediately alerts buyers to just how committed you are, while also speeding up the bidding, by scaring off the unsure and moving the bidding closer to what will become its final price.
Additionally, this technique makes it appear as though you have limitless funds and hence are able to bid so high, again, intimidating the competition.
Another method which many buyers have found effective is to immediately follow counterbids with your own bid. This makes you seem inexhaustible and a serious opponent. In poker terms, you’re encouraging them to fold early and just let you have the pot.
Ready to Go?
You have our tips, now it’s just time for you to take on that auction and get started on your road to property glory.