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  • 13 step auction day game plan

    13 step auction day game plan

    Auction day can be both a nervous and exciting time, especially if you have been searching for some time and think you may have finally found the right property.

    More often than not, things happen very quickly at auction so it is important that buyers be well prepared and have a game plan in place to help stay cool under pressure.

    The auction day game plan is really a number of tactics that allow you to stamp your authority on the auction and leave the impression that you know what you are doing.

    Here’s how it’s done.

    1. Do your homework and research comparable property sales

    Before purchasing a property, it is important to have done your homework and know the market as best as you can. Attend as many auctions as possible, follow the properties for sale and get a true feel for the local market over a number of months. Paying 5% more than you need to may not sound like a lot, but consider all those extra weeks you need to work to pay off that extra amount on your home loan.

    2. Do your due diligence

    It’s good practice to thoroughly read the contract of sale ahead of auction day and ensure you ask all your questions prior to the big day. You might want to consider paying a smaller deposit or requesting extended settlement terms, however these details need to be pre-arranged with the agent in advance.

    3. Set a pre-auction budget that is an uneven number

    It’s important you set a pre-determined limit on your bidding when you are calm, rational and can determine a realistic number … and be sure to stick to it! Think about this limit and then come up with an unrounded number. If you can, make your limit $503,000 as opposed to $500,000 or $626,000 instead of $625,000.Other buyers will tend to think in terms of round numbers and you need to have an edge over them.

    4. Dress to impress

    I know it might be a Saturday but ditch the track-suit. You are here to do business, so look the part! This doesn’t mean dress in a suit but make sure you look professional.

    5. Stand at the front so you have a birds-eye view of your competition and the auctioneer

    Be visible and ask a question at the start of the auction. Don’t hide behind a tree or in amongst the crowd. Assert your presence and let people know you are ready to participate, confident and experienced. Always keep other bidders in your sights and follow their body language. Also, greet agents by name and refer to them and the auctioneer by name during the auction process. This will show other bidders that you are a serious contender.

    6. Start with a strong first bid and then bid up in large increments

    Get involved early and be part of the action. Start to exert some influence over the conduct of the auction. If there are no other bidders, then you are in the box seat already!

    7. Say the full bids not just the bid increment

    Call out $651,000 instead of $1,000 so the other bidders know exactly what they are paying.

    Be sure to fully articulate your bids, clearly and confidently.

    8. Record the bids so you don’t lose track

    This is a great visual tactic. It reinforces that you are organised, experienced and on top of the situation. It also will keep you involved, even when you are not making a bid.

    9. Ask if the property is 'on the market'

    This tactic keeps you in the game and can force the auctioneer to reveal something that could help your game plan unfold. It also signals to other buyers that you are interested.

    10. Keep calm and watch your body language

    This is absolutely essential. You need to leave the auctioneer and other bidders with the impression that you know what you are doing.

    11. Use a combination of knock out bids and break down bids to slow bidding

    You might be at the upper end of your limit, however you need to try and control the pace and momentum of the auction by varying the scale of the bids. Try increasing the bidding amount from $1,000 to $5,000 to attempt to knock out the competition or if the auction is moving too quickly, offer a lower bid amount to what the auctioneer is asking for, for example bids in $1,000 increments instead of $10,000 increments.

    12. Get someone else to bid for you to take away the emotion

    An auctioneer can easily spot an emotional bidder so you may want to consider engaging a professional such as a Buyer’s Agent or Advocate, or at least someone independent to bid on your behalf. Consider your limit and advise them accordingly in writing to avoid any errors.

    13. Have some fun

    Don’t be too serious!

    The most important thing to remember is to keep within your budget and be prepared to walk away. Remember, there are always new properties coming on the market.

     

    About the author

    • Frank Valentic

      You have seen Frank bidding at auction on the hit television show, The Block over the last five seasons and have witnessed his competitive instincts and energetic nature first-hand, joining The Block as a regular weekly Buyer’s Advocate judge in 2015.

      Away from the television cameras, Frank is the Director of Advantage Property Consulting and is considered to be one of Australia’s leading Buyer's Agents and Vendor's Advocates. Frank has now teamed up with The Great Australian Dream as the series Buyer’s Advocate to show viewers the many tricks and tactics to purchasing the right property at the right price.

      Frank Valentic
     

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  • Disclaimer:

    The information here is of a general nature only and is not intended to constitute financial or tax advice. You should consult your professional adviser, accountant or taxation expert for advice specific to your personal circumstances.