How to secure your dream home...online!
Bidding at online auction… not for the faint hearted.
With all the off market sales that are being offered at the moment, we are seeing a rise in vendors who are cautiously ‘testing the market’. Buying a property under online auction conditions can be a great way to purchase from a vendor who is committed to the process and prepared to meet the market on price.
Even in this new environment, many of our usual bidding strategies remain imperative to securing the sale. Though not being able to see your opponents and read their body language does add a new layer of complexity to the practice.
After spending the last few weeks fighting it out in virtual auction rooms for our clients;
We have put together our top 5 tips on how to secure your dream home….online!
1. Know your values – as with any property purchase you must take the time to figure out the property’s market value, this can be done by researching recent comparable sales or engaging a professional to guide you. If you are confident in your valuation you can bid assertively and focus on your strategy. Rather than floundering to keep up with potentially fast paced, competitive bidding on the day.
2. Set your limit - Stick to it and never make it a round number! - If the value of a property is around $800k and bidding is sitting at $795,000, there's a good chance at least some of the other bidders will have set their limit at $800,000… If you are prepared and have set your limit at $807,000 then you’ll be in the box seat to throw in a final knock out bid of $807,000, put everyone off their game and potentially secure it!
3. Have a plan of attack – For an inexperienced bidder or first home buyer, bidding at auction can be intimidating; but leave the fear at home, an auction demands strength, conviction and a bullet proof strategy. Even in an online forum you want to send a clear message to your competitors. The message is that you know what you're doing, you know the value of the property, you have the money and you intend to buy.
4. Be decisive & persistent – Once you have made the move to come into the bidding fray, don’t back down. An auction is as much about the actions and determination behind the bid as it is about the figure put forward. Control your pace, avoid hesitation and counter bid consistently so you are always out in front. Even if you are nearing the top end of your budget, as far as your competitors are concerned you have no plans on letting it go.
5. Be in the box seat - If it’s going to pass in let it be to you. If the bidding falls short of vendors expectations they may request the agents pass the property in, you need to be the highest bidder if you want to deal exclusively with the vendor at their reserve price. Majority of sellers are at their most reasonable (and vulnerable!) on auction day, they are stressed, nervous and have emotionally committed to selling on the day! So it can be a great position to be in, IF you have strong negotiations skills. If not, you may be the lamb to the experienced agents slaughterhouse.
Always remember to leave your emotions out of it and if you are not feeling confident call in the professionals!
Until next time…
Sam Davenport