If you’re in the market to purchase a property this year we suggest you read on. In today’s Pursuit Property Advisory News, Managing Director Brad Willmott shares insights from his advocacy experience, explaining how a buyer’s success rate at auction can be improved with some prudently considered tactics.
Setting up an auction strategy
The first thing to do when preparing yourself to buy at auction is to define your strategy. Don’t leave any one thing to chance. Purchasing at auction is not always about who has the most experience and a savvy first homebuyer can triumph over a seasoned investor if they’ve prepared themselves to bid confidently. Your strategy should include simple factors like having your finance pre-approved, engaging a lawyer or conveyancer to ensure the auction contract is appropriate and having a hard limit on your bidding.
Know what the property is worth
When talking Melbourne real estate, the actual property value, the price quoted by the selling agent and the eventual sale price at auction are rarely the same. Buying well means paying a fair price for your property. Pursuit Property Advisory buyer advocates work with their clients to show a clear picture of the property's true value, based upon a variety of market indicators and comparable sales information. When you have a clear understanding of a property’s value, it allows you to develop a more effective bidding strategy – and it gives you the knowledge needed to walk away from an auction if it becomes an overheated bidding war. However, you may be the only bidder at the auction with the confidence to make a well informed ‘knock out’ bid, extinguishing the hopes of any competing bidders in one move.
Play your cards close to your chest
The way that you bid and behave in the auction scenario can directly affect a property acquisition outcome. An inexperienced buyer’s behaviour at property inspections and during conversations with estate agents about a home they’re interested in purchasing can also impact upon negatively upon their purchasing power. Letting an agent know your budget can put you at a disadvantage should a property be passed in to you – so be cautious and exercise discretion, no matter how friendly the real estate is.
It might sound basic, but understanding and respecting auction etiquette can make a difference. Bidders who try to control the auction, and attempt to put their competition off with unflattering remarks about the property only show how badly they want the property! Just be amiable and show the selling agents, fellow bidders and the vendor common courtesy.
Have your ducks in a row
Allow preparation time to agree on your budget in collaboration with trusted advisors such as buyers’ advocates and valuers, have all your required terms and conditions (such as settlement period) agreed to prior to auction and define your bidding strategy. Are you going to make an early knock-out bid or will you sit back and wait for the competition to show their hand? Or are you aiming to create a ‘pass in’ situation? These auction tactics make all the difference to buying well.
If you’d like professional assistance in making a better buy when it comes to your next home or investment property, Pursuit Property Advisors can help. Contact us for a free, initial, 45 minute consultation where we can discuss your next property purchase.
#auction, #bidding, #buyeradvocate, #estateagent, #Pursuit Property Advisory, #Melbourne, #realestate