07 Aug 2016
Auction Tips for Buyers & Sellers

Auction Tips for Buyers & Sellers

Auction Tips for Buyers & Sellers
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Guid,Tips,Selling,Auction real estate agents

Auctions can prove an effective tool for buying and selling, although not without risk.

Here’s our top tips for buyers and sellers to maximise their results at auctions.

Tips for buyers

  • Research - It is important to research the market around your property of interest as there are a number of key factors to look out for that can affect a property’s long-term value including levels of supply/demand and proximity to key amenities.

  • Get a feel for auctions - It is wise to observe other auctions in the area before going in to bid on a property; get a feel for how auctions are carried out and gain exposure to different auctioneers.

  • Make your interest known - If you come across a property that you’re interested in buying at auction, make sure to let the selling agent know of your intentions.

  • Get pre-approved finance - If you are planning to bid at a public auction, it is important to make sure that you have your finance formally approved before auction day. A 10 per cent deposit is usually required for auction buys, unless arranged otherwise.

  • Know your limits - Buyers at auction generally fall into two main categories – those who are bank-limited (approved up to a certain amount of money) and those who are self-limited (those who have a self-imposed limit that they will stick to). At the end of the day, there will always be more properties, and you stand a better chance of making money in the long-term if you buy at the right price.

  • Have a game plan - Be prepared with a game plan for bidding – that is, know when you’d like to begin bidding, what the sale price is likely to be, and what your price limit is.

  • Registration - You must have a driver’s license or passport on-hand to register as a bidder. It is also important to arrive at the auction well in advance to register and be ready to bid when proceedings commence.

  • Be in it to win it - The adage “you need to be in it to win it” rings true when it comes to auctions. Don’t sit on the sidelines and miss out on your dream home or prime investment because you are too scared or tentative with your bids.

  • Settlement - Once you have secured a property at auction, contracts will be signed immediately and a deposit will need to be paid. Standard settlement periods are 42 days, however, this period can be varied to 60 or 90 days, depending on the vendor’s circumstances.

  • Moving day - It is wise to arrange an inspection the week prior to settlement to ensure that the property has remained in the same condition as it was when you bought it. It is also advisable to check in with your bank, solicitor and removalist the week before to make sure that there are not any last-minute issues.

Tips for Sellers

  • Presentation – This is an integral component to achieving a successful sale at a premium price. Discerning buyers are often drawn to the negative, rather than positive, features of a property – so it is important to wow them with great styling and presentation from the outset. Check out our helpful article on staging your home for sale.

  • Marketing is paramount - An effective marketing campaign is essential for a successful auction. Most marketing experts recommend spending one per cent of the property’s value on marketing.

  • Stay calm - It is important to remember that you have three opportunities to sell your property – before, on or and after auction day. Keep this in mind throughout the auction process to ensure that you don’t accept a price well below your expectations simply to sell. The worst case scenario is that you will have to move to stage three and put a price on your property, but don’t make a premature or irrational decision because you let stress get the better of you.

  • Pay attention to feedback - Your agent should consistently provide you with buyer feedback from inspections and inquiries. Be sure to take these comments into consideration when presenting the property and setting your reserve price. After all, the more you cater to the wants and needs of buyers, the better chance you have of achieving a strong sale price.

  • Meet regularly with your agent - As auction campaigns are often condensed and high impact, a 15-minute face-to-face discussion with your agent at least once a week is a must. You should also meet with your agent the week prior to auction to finalise your instructions and bed down your reserve price.

  • On auction day - It is best to be present on-site when your property goes under the hammer. On auction day, you’ll be looking to sell one of your most valuable assets, and through directly observing the auction process and buyer interest in the property, you’ll position yourself to make better informed decisions in any post-auction negotiations.

  • Be prepared to adjust - If buyers bid close to your reserve price, it is possible to adjust your price in writing to secure a sale. However, beware that if your property is sold during the auction, the sale will be binding. If, on the other hand, you decide to pass aside and negotiate after the auction, there will be no obligation on the buyer to proceed. In these types of situations, you can put yourself at risk of losing the sale if negotiations stall or the buyer changes their mind.

  • Vendor bids - Vendor bids are commonly made on behalf of the auctioneer to start the bidding or to protect the seller’s reserve price during the auction.

  • After the auction - Make sure that all parties sign the sale contract with the correct names, price and settlement dates. Also, ensure that the contract is dated and that buyers have paid their deposit before you pop the celebratory champagne.

For more property tips and tricks visit the blog section of the Naked Real Estate website.

 

.

Here’s our top tips for buyers and sellers to maximise their results at auctions.

Tips for buyers

  • Research - It is important to research the market around your property of interest as there are a number of key factors to look out for that can affect a property’s long-term value including levels of supply/demand and proximity to key amenities.

  • Get a feel for auctions - It is wise to observe other auctions in the area before going in to bid on a property; get a feel for how auctions are carried out and gain exposure to different auctioneers.

  • Make your interest known - If you come across a property that you’re interested in buying at auction, make sure to let the selling agent know of your intentions.

  • Get pre-approved finance - If you are planning to bid at a public auction, it is important to make sure that you have your finance formally approved before auction day. A 10 per cent deposit is usually required for auction buys, unless arranged otherwise.

  • Know your limits - Buyers at auction generally fall into two main categories – those who are bank-limited (approved up to a certain amount of money) and those who are self-limited (those who have a self-imposed limit that they will stick to). At the end of the day, there will always be more properties, and you stand a better chance of making money in the long-term if you buy at the right price.

  • Have a game plan - Be prepared with a game plan for bidding – that is, know when you’d like to begin bidding, what the sale price is likely to be, and what your price limit is.

  • Registration - You must have a driver’s license or passport on-hand to register as a bidder. It is also important to arrive at the auction well in advance to register and be ready to bid when proceedings commence.

  • Be in it to win it - The adage “you need to be in it to win it” rings true when it comes to auctions. Don’t sit on the sidelines and miss out on your dream home or prime investment because you are too scared or tentative with your bids.

  • Settlement - Once you have secured a property at auction, contracts will be signed immediately and a deposit will need to be paid. Standard settlement periods are 42 days, however, this period can be varied to 60 or 90 days, depending on the vendor’s circumstances.

  • Moving day - It is wise to arrange an inspection the week prior to settlement to ensure that the property has remained in the same condition as it was when you bought it. It is also advisable to check in with your bank, solicitor and removalist the week before to make sure that there are not any last-minute issues.

Tips for Sellers

  • PresentationThis is an integral component to achieving a successful sale at a premium price. Discerning buyers are often drawn to the negative, rather than positive, features of a property – so it is important to wow them with great styling and presentation from the outset. Check out our helpful article on staging your home for sale.

  • Marketing is paramount - An effective marketing campaign is essential for a successful auction. Most marketing experts recommend spending one per cent of the property’s value on marketing.

  • Stay calm - It is important to remember that you have three opportunities to sell your property – before, on or and after auction day. Keep this in mind throughout the auction process to ensure that you don’t accept a price well below your expectations simply to sell. The worst case scenario is that you will have to move to stage three and put a price on your property, but don’t make a premature or irrational decision because you let stress get the better of you.

  • Pay attention to feedback - Your agent should consistently provide you with buyer feedback from inspections and inquiries. Be sure to take these comments into consideration when presenting the property and setting your reserve price. After all, the more you cater to the wants and needs of buyers, the better chance you have of achieving a strong sale price.

  • Meet regularly with your agent - As auction campaigns are often condensed and high impact, a 15-minute face-to-face discussion with your agent at least once a week is a must. You should also meet with your agent the week prior to auction to finalise your instructions and bed down your reserve price.

  • On auction day - It is best to be present on-site when your property goes under the hammer. On auction day, you’ll be looking to sell one of your most valuable assets, and through directly observing the auction process and buyer interest in the property, you’ll position yourself to make better informed decisions in any post-auction negotiations.

  • Be prepared to adjust - If buyers bid close to your reserve price, it is possible to adjust your price in writing to secure a sale. However, beware that if your property is sold during the auction, the sale will be binding. If, on the other hand, you decide to pass aside and negotiate after the auction, there will be no obligation on the buyer to proceed. In these types of situations, you can put yourself at risk of losing the sale if negotiations stall or the buyer changes their mind.

  • Vendor bids - Vendor bids are commonly made on behalf of the auctioneer to start the bidding or to protect the seller’s reserve price during the auction.

  • After the auction - Make sure that all parties sign the sale contract with the correct names, price and settlement dates. Also, ensure that the contract is dated and that buyers have paid their deposit before you pop the celebratory champagne.

For more property tips and tricks visit the blog section of the Naked Real Estate website.

 

Written by Naked Writers

Auction Tips for Buyers & Sellers
Naked Writers

Naked Real Estate Writers collaborating to bring the latest news and trends in real estate for buying, selling and working in the exciting world of real estate. Is it time for you to get Naked?

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