Don't Let Auctions Scare You

With preparation and a clear strategy, property auctions don't need to be a frightening experience.

Buying a property at auction can be an exciting and rewarding experience, but it can also be overwhelming and stressful, especially if you're a first-time auction-goer. In

this blog post, we'll share some tips to help you prepare for a property

auction, stay calm and focused during the auction, and avoid some common

mistakes that can lead to disappointment.

Before the Auction:

Research and Preparation: Do your homework before the auction. Research the property, the local market conditions, and the auction process. Understand the property's value, any potential issues, and the legal terms and conditions of the sale. Also, check the auctioneer's website and get familiar with the auction rules and regulations. Complete pest and building inspections.

Engage a conveyancer: Review the contract of sale and undertake the necessary searches so you don’t find any problems eg caveats, easements, overlays, unapproved works or covenants. Sometimes you may need to ensure the vendor provides with certificates of compliance eg Pool Safety, Waterproofing, Fire Safety etc.

Set a Budget: Determine your budget and stick to it. Consider the maximum amount you're willing to spend, including all additional costs like legal fees, stamp duty,

and other associated expenses. Make sure you have sufficient funds or

pre-approval from your bank to pay for the deposit on the day of the auction. You

can’t bid at an auction is subject to finance.

Inspect the Property: It's best to Inspect the property and attend the open house in person. Engage with the agent or auctioneer and ask any questions you have. Walk through the property, take photos, and make notes of any issues or repairs that need to be addressed. Ask how much interest there has been in the property.

Ask if the vendor is in a hurry to settle – they make not have bought a new

place and might appreciate a longer settlement. Check what fixtures are

included in the contract – you want to avoid fixtures going missing on

settlement.

Observe – go to several auctions to learn the process, to observe the auctioneer’s tactics and bidders’ tactics. Check out auction clearance rate reports and review prices and also what property properties have been sold and what properties have been passed in.

During the Auction:

Stay Calm: Remain calm and composed during the auction. Don't let the excitement and emotions of the event influence your decision-making process. Stick to your plan and don't be swayed by other bidders.

Bid Confidently: When bidding, be confident and clear in your bids. Use a clear signal or hand gesture, so the auctioneer can easily see your bid. Avoid hesitant or unclear bids that may confuse the auctioneer and other bidders.

Know Your Limits: Know your limits and don't get carried away with the auction's momentum. Stick to your budget and avoid overpaying for the property.

After the Auction:

Pay the Deposit: If you are a successful bidder, pay the deposit immediately after the auction. Typically, you'll need to pay 10% of the purchase price on the day of the auction (you can negotiate a lower amount).

Seek Professional Advice: Notify your solicitor or conveyancer to assist with any necessary legal documents and guide you through the settlement process.

Inform your broker: If you are successful, your broker should be told so they can start the formal process of finalising your loan and liaising with the lender.

Protect the property: Obtain insurance as you now have a financial interest in the property.

In conclusion, buying a property at auction requires preparation, research, and a clear strategy. Remember to stay calm, confident, and focused during the auction and avoid getting carried away with the momentum of the event. With the right preparation and approach, you can increase your chances of success and make a smart investment in a property that you love.

If you're interested in investing in property and want help with your property-buying strategy options, I'm offering a FREE 45-minute Strategy coaching call where we'll create your custom game plan to set you up for success in 2023.

I will be doing these calls on a first-come, first-served basis so if you're interested, please click here to schedule your call now.