Pre Auction offers

[Tom_84]

I understand this can be risky as you are not only showing your hand early, but also opening it up for others to make an offer against you which is not transparent like at auction. However would a strong offer early in the campaign (2 weeks in) also potentially best others to the lunch who may not have either looked at it, or had their finances sorted?
Weighing up whether to put something in early. Thanks for advice

 

[The Y-man]

Which state?

In Victoria, unless the offer is *very* strong, the vendor will not consider it until 3 days before the auction.

Once it is in the 3 day timespan, your offer is unconditional (you can't pull out come hell or high water) so it is as if you bid at auction.

The Y-man

 

[Tom_84]

Which state?

In Victoria, unless the offer is *very* strong, the vendor will not consider it until 3 days before the auction.

Once it is in the 3 day timespan, your offer is unconditional (you can't pull out come hell or high water) so it is as if you bid at auction.

The Y-man

In Victoria, the offer would be unconditional. I would put in a very competitive offer, with perhaps some room to negotiate however it would be an offer I feel that may tempt the vendor. My only worry is I may show my hand too early?

 

[cd83]

Perhaps if the vendors are chasing a quick sale and there isn't loads of interest it will work in your favour.

 

[Scott No Mates]

A pre auction offer can be used to set the reserve especially if there's lots of interest or temper expectations where no guide price is set or as indicated above may be incentive enough to forgo the auction and get a quick sale. It will depend on the vendor's motivation, fear and greed.

 

[The Y-man]

In Victoria, the offer would be unconditional. I would put in a very competitive offer, with perhaps some room to negotiate however it would be an offer I feel that may tempt the vendor. My only worry is I may show my hand too early?

Possibly. Put an expiry on it. Otherwise, if I was the vendor, I would tell the agent, "Good to see some serious interest! Let's wait to see what eles we can get".

The Y-man

 

[Jamie M]

Hi Tom

Has there been quite a lot of interest in the property?

Do you know why the vendors are selling? If so - is there anything else you can do to sweeten the offer (such as extended/short settlement time, rent back period, etc).

Cheers

Jamie

 

[Tyla]

I believe it would depend on the market condition and vendor's expectations. My BIL attended a few auctions near Chadstone recently and the prices were way above expectation (at least his). If the vendors are choosing to go to auction because they expect to get more $ through competition, it may be very hard.

Would love to know how you go. Good luck, mate.

 

[Tom_84]

Thanks for advice so far..
Vendor selling as has another property in development, doesn't appear to be in a real hurry. The reason I'm being aggressive is at both OFI interest seems on the lower side, and I want to get in early with a strong offer when there may be an element of doubt in the rea eyes as to the interest on the property.
I will give a timeframe on the offer and explain I have other auctions I will be bidding at prior to this auction so this could be my only offer.
It's a risk by showing my cards but worth a try, who knows on the last week of the campaign someone willing to pay more than me for it may see it and by getting in early I could minimise the competition

 

[Tom_84]

So still weighing up what to do. My conundrum is I don't want to offer too high as the rea will feel this is the reserve and what it can get at auction day, but I want to offer something they will be interested in.
In my opinion this property is worth between 475-500K and I am confident at auction it will go somewhere in that range, but with competition it may break 500K. Do I put an offer at 475 and leave room to negotiate, or do I put a stronger offer of 482K and state this is my only offer and valid for 2 days?
By offering more I run the risk of them feeling it could get significantly more than this, but on the flip side I would be more than happy to pick it up at this price

 

[mikezen]

So still weighing up what to do. My conundrum is I don't want to offer too high as the rea will feel this is the reserve and what it can get at auction day, but I want to offer something they will be interested in.
In my opinion this property is worth between 475-500K and I am confident at auction it will go somewhere in that range, but with competition it may break 500K. Do I put an offer at 475 and leave room to negotiate, or do I put a stronger offer of 482K and state this is my only offer and valid for 2 days?
By offering more I run the risk of them feeling it could get significantly more than this, but on the flip side I would be more than happy to pick it up at this price

Is this in Melbourne? We are about to go to auction and the agent has been running our campaign 10% under where we want to land...this seems to be the norm for Melb....apparently, however we are bayside so slightly different market to what your competing in...

 

[Tom_84]

Is this in Melbourne? We are about to go to auction and the agent has been running our campaign 10% under where we want to land...this seems to be the norm for Melb....apparently, however we are bayside so slightly different market to what your competing in...

Yes it is in Melbourne, and running an advertised price 10% lower than the reserve or the expected price is par for the course unfortunately... just part of the game