Why it pays to have professionals on your team at auction (CASE STUDY)
Property Wizards represented a client at auction over the weekend and achieved a fantastic outcome – securing them a beautiful home in the Perth hills.
The property was secured at $25,000 below the bank’s reserve using auction techniques and skills to ensure bids did not reach any higher than they had to and through skilled post-auction negotiation. Here’s how…
While auctions can be daunting and we recently talked about some of the DOs and DON’Ts at auction, this result again showed why it pays to have experienced professionals on your side. The property is a grand country home, complete with a pool and tennis court, attracting more than 40 potential bidders, and six registered bidders.
This reflected the eagerness of buyers to capitalise on market conditions, the low interest rates and the chance to secure a large family home in the Perth hills.
Interestingly, and as often happens, not all registered bidders participated. Considering it takes some effort before auction to be a registered bidder – conducting due diligence, doing the research to ascertain the property’s actual worth, getting your finance in order, thoroughly reviewing the contract, so you are ready to act – and buy – it’s interesting that this often happens.
There’s a few reasons people baulk at auctions:
- They don’t do enough research to assess the right price to pay, so don’t know where to start or anticipate buying at an unreasonably low price
- They haven’t ascertained their true maximum bid – so worry they might bid more than they should, so don’t bid at all
- They get caught up in what other bidders are doing and don’t focus on their strategy
- They are intimidated by the subtleties and nuances of auction – other buyers, the agent, the auctioneer
- It can happen very quickly, and before they feel ready to bid, it’s all over
- They don’t attend other auctions in advance to get a feel for the process
Even when they do their homework and feel they’ve come prepared, they still might baulk due to the intensity of the occasion, nerves or emotion.
If you do your homework, do all your due diligence, you’ll know exactly what you should be paying, can set your limit and execute your strategy with confidence.
As this example showed, it can also help to have a professional or trusted friend on your team – someone who can understand your goals, discuss your strategy, ascertain your true maximum bid and what is a fair price to pay, and, by bidding on your behalf, remove any nerves or emotional attachment on the day. This could mean the difference between securing the property at the lowest price – and missing out.
If you want to secure a home at auction and would like a professional on your team, call us on 08 9381 7450.
Or, if you’d just like more information about what to look for and how to buy the right property, why not fill out our Getting Started form.