MICHELE’S TIPS
What are some Auction tactics?
This is intended only as a general guide to understanding this topic. Contact me to
discuss your individual circumstances.
Definition
An auction is conducted in public on a date set by the vendor. If you intend to make a
bid, you or your representative will have to attend the auction to make an offer. You
will win the auction if you’ve offered the highest bid above the vendor’s reserve price.
If all bids are under the vendor’s asking price, the property is “passed in” and the
auction is finished. Private negotiations will then usually take place with the auction’s
highest bidders.
Benefits
ü
You know who your competition is, and what they are willing to pay.
Disadvantages
ü
There is no Cooling off period, and your bids are unconditional.
ü
Inspections & Searches must be completed and paid for prior to auction,
without a guarantee that you will be the successful bidder
Things to consider
ü
Always have your conveyancer review the sales contract prior to making a
bid.
ü
Before the auction, decide what your maximum price is and Stick To It.
ü
Never set your maximum price at an even amount, as many other bidders
will do, and an additional $1500 can often win you the property.
ü
Go to several auctions to understand how they work, before attending an
auction for a property you are intending on bidding at.
ü
If you need to, take your time between bids. The auctioneer is not going to
sell to another bidder if they think you are still in the running.
ü
Stand adjacent to the Auctioneer, so you can see clearly who you are bidding
against.
ü
Bid confidently, almost aggressively and without hesitation to give the other
bidders the impression that you have ‘bags of money’ and no limit.
Michele Mansfield.
Equity Vision Pty Ltd ABN 88 104 601 087
Phone 03 9576 7255 or 1300 553 969 Fax 03 8668 1215 66 Hodder Street, Brighton East VIC 3187
www.equityvision.com.au
email: [email protected]
Michele Mansfield is a credit representative (CR No. 399836) of BLSSA Pty Ltd (Australian Credit Licence No. 391237)
ü
Don’t start the bidding, nor commence to early. Be patient & size up the
competition.
ü
Ask the auctioneer when the property is on the market, as this is when each
bid is potentially the winning one. In Melbourne, properties most often are on the
market once the auction has re-started after the auctioneer has paused the process
and gone inside to “refer to the vendor”.
ü
If the bidding doesn’t reach the reserve price and the auctioneer states that
the property will be passed-in, ensure that it will be passed in to you by having the
highest last bid. This will give you the right to negotiate with the vendor in the first
instance.
ü
If the bidding goes above your maximum purchase price. Stop bidding and
walk away. There will always be another property – the streets are full of them.
ü
If this is all too scary, consider hiring a Buyers Advocate, or get a family
member or close friend to bid for you - taking the emotion out of the bidding
process.
ü
Bidding tactics you can use include:
· Slow down the bidding (e.g. if it has been jumping up by $5,000 – make a
$1,000 bid).
· Make a “knock-out” bid to scare away the competition.
Michele Mansfield.
Equity Vision Pty Ltd ABN 88 104 601 087
Phone 03 9576 7255 or 1300 553 969 Fax 03 8668 1215 66 Hodder Street, Brighton East VIC 3187
www.equityvision.com.au
email: [email protected]
Michele Mansfield is a credit representative (CR No. 399836) of BLSSA Pty Ltd (Australian Credit Licence No. 391237)