Imagine attending an auction for the home of your dreams, only to find there are 20 other keen bidders waiting to beat you to the punch?
With the property market in some parts of the country running red-hot, this is a likely scenario you’ll come across. But if you want to achieve the best auction results and secure your ideal property for sale, you’ll need to step-up as a bidder.
This doesn’t just mean turning up early on auction day and hoping for the best. Beating out the competition takes a lot of preparation and a bit of hard work. Here are three tips to help you on your real estate auction journey.
Do your due diligence
As with any property purchase, doing your homework is paramount. However, this is even more important for properties that go under the hammer. The reason for this is because residential real estate auctions are unconditional.
The key to being a winning buyer is to bid with confidence, and knowledge is crucial to this. If you’re serious about buying a certain property for sale, get your pest and building inspections done for peace of mind.
For investors looking to obtain a property with potential for growth, get the home valued by an independent professional.
Sort out your finances
Have you set a maximum price for yourself? Will you know when you’ve overpaid for a home? Knowing your financial limits is another crucial step to being a confident and winning bidder. Make sure you’ve taken time to meet with a broker to sort our your home loan well before auction day. Even better, get your mortgage pre-approved so you’ve got everything ready to go on the big day.
Remember, at the time you sign the auction agreement, you’ll need to pay the deposit for your new home. This is usually ten per cent of the property’s price and is held in a trust until settlement day rolls around. As it’s payable on auction day, ensure you’ve got the funds ready to go by way of personal or bank cheque.
Have a back-up plan
If the auction doesn’t meet its reserve and the property is passed in, it’s not time to head home heartbroken. You may still have a chance at buying it. Usually when a home gets passed in, the highest bidder can be granted the right to negotiate with the vendor. This means you’ll need to brush up on your negotiating skills and make an offer to the vendor and real estate agent that can’t be turned down.