An auction is the most heart pounding experience a buyer will face on the path to owning what might be their first or twentieth home.
The high stakes event can often feel like a poker game or an emotional rollercoaster for some. This can make it easy to get swept up in the mayhem — by paying more for a property than planned, or missing out due to a bad technique.
While a property’s features and the local property market have the most significant impact on how much a buyer will pay, having the right bidding strategy might just ensure you walk way with the keys, Cooley Auctions auctioneer Michael Garofolo said.
“Don’t be afraid make the first bid, as this allows you to take control of the auction and it shows the bidders you mean business,” he said.
Making the opening bid means the buyer can set the tone for the rest of the auction, Mr Garofolo said, adding that by starting strong, it could also scare off other buyers from bidding.
He said it was not about where a bidder starts with their opening bid, but where it finished.
“Be cheeky and offer less than the guided price, as nine times out 10, the auctioneer will always counter and might meet you halfway,” he said.
“Just remember to not put your best and final figure first as you want to leave some fuel in the tank.”
The auctioneer said buyers should never wait for the property to be called to market before bidding, as it increased the risk of overpaying.
“It means any bids from here are at market value or above,” he said.
Mr Garofolo said bidders should instead be proactive beforehand to give themselves the best opportunity to be at the front of the pack for any negotiations that come up.
Making small bidding increments of $1000 at the end of the auction could also see a buyer miss out, Mr Garofolo said, adding it allowed others to remain in the picture.
“I’ve seen many buyers miss out by $500 because they didn’t attempt to land a knockout bid,” he said.
At the same time, buyers’ agent Rich Harvey of Propertybuyer said people should also not throw a knockout $200,000 bid in an attempt to wipe out the competition.
“It doesn’t always work, and you could be left paying far more than what the home was actually going to sell for,” he said.
Wearing sunglasses or the body language you let off could also impact your prospects of winning an auction Mr Harvey said.
“Some buyers like to wear sunglasses like a poker play would to hide their intentions or what they are thinking,” he said.
The buyers’ agent said it did not matter where a person opted to stand during the auction, as long as the auctioneer can see them.
Before even placing a bid, Mr Harvey said it was important to research the local market to see what the competition is like and how much homes are selling for to allow you to create the best auction strategy.
“This allows you and your bidding partner to work out what is the maximum amount you will bid and will not go past,” he said.
“Never do flexible figures as you will end up regretting it after the auction when you have to go past your budget.”
Mr Harvey also advised buyers to write down your bids and ensure the auctioneer hears your correct bid.
“The early $1 millions can get quite confusing, and an auctioneer might hear a higher bid than you want,” he said.
Despite Australia being in the middle of its first recession since 1991, the number of scheduled auctions is expected to ramp up over the coming months with the arrival of the popular spring selling season.