Auction advice anyone?

S

startingnow

Hey everyone, we have a place we have had a look though a few times and are ready to battle it out at auction this saturday.

Being the first time we have ever bid. Is there any advice you could give or lessons you have learnt that could help us?

Or any links that would be helpful would be appreciated to.

thanks in advance
 
startingnow said:
Hey everyone, we have a place we have had a look though a few times and are ready to battle it out at auction this saturday.
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Are you now? Good for you.:)
Let me ask you a couple of Q's now:
Do you know what the property is worth to within $5-10K?
With this in mind, have you set yourself an upper limit?
How many registered bidders will be there?
What is the vendor's expectation of price?
Is it in line with the current market expectations?
What other pre-auction offers have there been? How many and how much?
Why are the vendors selling?
Have you conducted pest & building reports on the property?
How many other intending purchasers have conducted pest & building reports?
How many contracts have be issued so far?
Have you looked over the contract?
Have you asked your solicitor to look over the contract?
Do you need finance to complete the sale if you win?
If so, have you had a formal valuation done?
Who is the auctioneer?
How many auctions have you seen this auctioneer conduct?
When he says "are you all finished all done?" and is about to drop the hammer, does he do it quickly or does he waver with time for you to put in another bid?
Are you planning to open the bidding?
If not, at what point do you plan to come in?
Where are you going to stand at the auction?
Will you be able to see the other bidders faces? or not?
Are you going to allow the REA's to talk to you during your bidding? or are you going to wave them away?
Are you going to bid in multiples of $1K, $5K or $10K?
At what point in the bidding are you going to change the bidding increments?
Are you going to bid after a vendor bid (if it comes to that)? or are you going to be the underbidder if it gets passed in?
This is just scratching the surface. If you do not know the answers to any one of the above, then may I suggest that you are not at all "ready to battle it out".

startingnow said:
Being the first time we have ever bid. Is there any advice you could give or lessons you have learnt that could help us?
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Oh dear :confused:
 
Know your limit. Dont bid above it.
Get a friend to bid on your behalf while you sit in the car.
Its quite easy to get caught away in the moment.

or

Get a buyers agent.

Hmmm i would have to wonder what housing prices would actually be like if everyone used a buyers agent.
 
haha. Thanks propertuntity and everyone for all the advice. Ok maybe im not ready to battle it out. But i have my capgun and a fully loaded super soaker.

I have had a building inspection done which came out fine, and gotten pre approval from the bank no probs. Ive had a realestate agent mate go through the place and give me a valuation (he works in the area).

As for the rest, well, we have a maximum bid which we feel is slightly under market value, so we are not really expecting to get the house, and if we do we feel it will be at the right price. (slightly better than market value- current circumstances considered)

As for what stage we will bid from, well we are not sure yet on. thats why i was asking for any advice :)
 
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startingnow said:
Hey everyone, we have a place we have had a look though a few times and are ready to battle it out at auction this saturday.

Being the first time we have ever bid. Is there any advice you could give or lessons you have learnt that could help us?

Or any links that would be helpful would be appreciated to.

thanks in advance
Click to expand...
Say very little to anyone,never let the many agents that will be there stand next to you and make you bid when you are in the twilight zone of those brief few minutes,some agents play that card very hard when they know you are interested ,or the very simple way is once you know more about the property then the people who's name is on the deeds ,future development,current development in the street ,and consider all the consequences ,some people i know wait if it's still in their price range till the first drop of the hammer then make 1k bids,but the most important is stay in total control focus on what you want not the RE,not the vendors who have to sell,just focus on what's happening around you after all once the ink is dry on the contract it's too late to walk out the gate,good luck..willair..
 
wow, yeah thanks willair. I imagine we are going to get harrassed by the agent on the day, so i will definatly keep that advice closely in mind. They have been pretty heavy on the phone calls so far, so i imagine they will be persistant on the day. how can i politley keep them at bay?

thanks so much for the valuable information everyone.
 
startingnow said:
As for what stage we will bid from, well we are not sure yet on. thats why i was asking for any advice :)
Click to expand...

Hehe :D OK - get answers to all the Qs I asked.
Also stand beside the auctioneer. It lets you see who you are bidding against.....and the agents hate it. So you can kill 2 birds with one stone.

I've had a few ask - "Would you like to stand over here sir?" motioning with their hand, back in the crowd. "No, I'm fine here thanks", I reply :)

The others have given good advice too.
 
Now to confuse you.

We have bid and been successful a number of times. We have no hard and fast rules as it depends on how the auction is going.

Firstly take your cheque book, they will require a 10% deposit.

Generally we don't make the first bid, however if no one is putting their hand up then you can make the first bid but start low.

Whether you bid first or not don't bid again until the bidding slows and their about to drop the hammer. If the property does get passed in you want to be the underbidder so that you have first right to negotiate.

Some people like to slow the bidding by offering $1k (or even a half). If it is getting close to your maximum feel free to do this however I have been at many auctions where $1k bids go back and forward and it still adds $20k to the price.

Sometimes it's worth giving a fairdinkum bid to knock out competitors and close the deal. Only do this if you still have a margin. It's best to get the auctioneer to advise when the property is on the market before getting too excited.

Good Luck

Andrew
 
Propertunity said:
Also stand beside the auctioneer. It lets you see who you are bidding against.....and the agents hate it. So you can kill 2 birds with one stone.
Click to expand...

I say this is "old hat". It also makes you stand out like dog's nakkers, which imo is not ideal.
You want to see them, and more important you dont want them to see you.
But there's many schools of thought on this matter with some people even suggesting acting like an idiot an making a fool of yourself, though I think it makes you look like a silly desperate noob.

As for "battling", well i think you got that wrong from the start.
Those that battle generally end up paying too much for being the proud battler.

Bargain Hunter said:
If the property does get passed in you want to be the underbidder so that you have first right to negotiate.
Click to expand...
Anyone can go and negotiate once the auction is over.
 
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Piston Broke said:
Anyone can go and negotiate once the auction is over.
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In Victoria, where I assume the OP is buying, the final bidder can gets the first and exclusive opportunity to negotiate with the vendor if the property is passed in.

startingnow, have you been to many many auctions to familiarise yourself with the process and various strategies that people use? We've 'won' twice at auction and used completely different tactics for both of them. One was a complete knock-out bid, the other was lots of small immediate bids to put pressure on the opposing party. It all depends on the flavour of the auction and who the auctioneer is.

As a bare minimum:
- set a limit and stick to it
- don't be seen as weak and indecisive. If there are two of you, DO NOT stand there and consult with each other whilst the bid is against you. So many couples expose themselves to the other bidder and REA when they do this!
- as others have mentioned, stand near the auctioneer and make your presence known

Goodluck. I actually quite enjoy the auction process and they're always fun to watch.
 
Not correct for NSW:
http://www.fairtrading.nsw.gov.au/Tenants_and_home_owners/Buying_property/Buying_at_an_auction.html

"If the highest bid is below this price, the property will be ‘passed in’. The seller will then either try and negotiate a price with interested bidders or put the property back on the market."

and
"there is no cooling-off period when you buy at auction, or exchange contracts on the same day as the auction after it is passed in."

There is no contract as there is no acceptance, regardless of where it is.
That's REA BS on the domain site.

http://docs.google.com/viewer?a=v&q...ptp61u&sig=AHIEtbTCudHm6oW8spITrpqTw3BxWbH1rw
"New laws we developed this year prohibit auctioneers
from accepting bids and offers after the property has
been knocked down to the successful bidder – commonly
referred to as ‘bids after the fall of the hammer’."

The "first right to negotiate" means nothing, it is also the duty of care of the agent to get the best for his client.

Anyone can go and negotiate once the auction is over.
I dont recommend this or say anyone should (as I rarely would), but that's how it is from my experience & understanding.
 
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startingnow said:
, so i imagine they will be persistant on the day. how can i politley keep them at bay?
Click to expand...
Most Agents are upfront in the way they act,you can play the same game
on them,just tell them you have found something else from a private seller in the area,and watch their face :):),and say you are only here for a look like 95% of everyone else inside the property,,then stand down the very back of all the punters,watch who the agents talk too prior too the auction,just stay calm and say very little and BTW you don't lose face by walking away from a industry that is dogged by big egos,leased german 2 door cars,poor accountability,waste,and in many instances creating more problems then it solves for the Title holders ...
..willair..
 
willair, don't you have to be a registered bidder at the auction to participate? At least that was my understanding here in SA. How do you claim that you are not interested and then still register to bid?
 
Piston Broke said:
I say this is "old hat". It also makes you stand out like dog's nakkers, which imo is not ideal.
You want to see them, and more important you dont want them to see you.
Click to expand...

There are many, many strategies as you know. This may be old hat, but it works for me. I do stand out but that is a hazard of my own frame. I am 6'2" and 120kgs - there is no way I can hide in a crowd of (mainly smaller) people. I think sometimes I do physically intimidate some bidders. :p
 
startingnow said:
Being the first time we have ever bid. Is there any advice you could give or lessons you have learnt that could help us?
Click to expand...

Listen to peoples advice that have experience bidding at auctions in the state that the property is located. Laws vary from state to state and people assume that what they do in their own state applies to your situation, as witnessed in the posts above.
 
hobo-jo said:
willair, don't you have to be a registered bidder at the auction to participate? At least that was my understanding here in SA. How do you claim that you are not interested and then still register to bid?
Click to expand...

There are no registered bidders in Victoria, any passer by can bid at an auction.
 
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