When it comes to auctions, small changes to your body language and game plan can be the difference between leaving empty handed or with the keys to your dream home.
Bring your game face auction day
A common issue seen novice bidders is a lack of control over their ego and letting the fear of missing out creep in. Come auction day, having control of your emotions is really important so you’re using your head and not your heart during the auction process.
The mid-auction side-eye to your partner is transparent to your rivals, who will know they have you on the ropes. It is an absolute dead giveaway, a family standing together, and they’re bidding confidently until one of them glances sideways at the other. Its a obvious sign they’re right down to their last $5000-$1000.
Body language and how you present yourself to the auctioneers and to the other buyers can also put a dampener on other people’s bidding confidence.
Being the first to raise their hand and enter a bid isn’t a common approach, but does allow the bidder to set the pace and control the auction. However it may excite your fellow bidders with a low offer. For a $1m projected house sale, an ideal opening bid for a house or apartment of this value would be between $880,000 to $900,000. Realistically, a good bidding strategy is to get rid of the bargain hunters but still maintain some bidders, just in case the owner’s reserve is too high and you need to negotiate.
Do not settle on a round number
When deciding on a maximum bid and seeking pre-approval, don’t settle on a round number because the rivals will and it’s an easy way to shake them off.We always make sure that our buyers have at least three bids after the round number. So if you wanted to spend a $1 million then we might settle on $15,000 past that so that we can get rid of those $1 million buyers with one or two bids. If they say it’s about an $800,000 property, most people set their limit at $800,000. They might go $805,000, but they won’t go $810,000. It’s such a small amount, but can make a huge difference.
Talk to the agent
A real estate agent’s role during an auction is to incite buyers and encourage bids, but as a house hunter you can use this access to engage the representative to get a better picture of where you’re at.
If you get the chance, you should be asking questions such as: Where are we in terms of the reserve? Are we far off? Are the sellers really committed today? Have they lowered their reserve during the auction?
If you’re talking to the agent during the auction you can start to get a bit of an idea about what’s happening behind the door with the seller.
And then if it does pause and there are some negotiations, don’t be afraid to negotiate during the auction. As long as it actually gets the property on to the market and below your maximum price, then that’s a really good strategy. Sometimes they’ll pause the auction and seek instruction from the owner and that’s when you want to be talking to the agent, waving them over and to say ‘how far are we away? What would it take to get the property on the market?