5 must know tips for bidding at auction as a first home buyer
Auctions can be stressful, heartbreaking and exhilarating – but just a little homework will set you up for success. Here are 5 top tips from top buyers advocate Ray Becher.
1 - Attend a few auctions before you’re ready to buy.
Auctions can be intense, and emotions can run high. There is a crowd of people out in the street, sometimes blocking traffic, the auctioneer is creating excitement, and no one knows who is a serious buyer is and who’s just there to watch. So, go to a few auctions - get accustomed to how they work, the way people bid, how the auctioneers try to steer the bidding. Then when it’s you in the ‘hot seat’, you’ll be more confident.
2 - Understand what the value of the property is.
Try to go to auctions for the sorts of property you might want to buy and in the locations, you’re interested in. Take note of the advertised price guidance and then how closely the auction result matches that. The price a property is advertised at needs to reflect the market in some way – but it is there to maximise interest in the property and then anything can happen at auction. Going to auctions, hearing the result, and comparing it to the advertised price guidance, will give you a good sense of what to expect at future auctions for similar properties.
3 - Have your finances in order
If you’re going to bid at an auction, then you’ll need your finances in order. Make sure your home loan is pre-approved, your deposit ready, funds set aside for stamp-duty and know what your hard, “under-no-circumstances-will-we-go-over-this-limit” bid will be. Make sure you have looked through all the documents before the auction and if anything bothers you, ask your conveyancer for clarification. Auctions can be intense when you are locked in competition with another keen bidder. There is no room for doubt or uncertainty. Know your facts and your numbers and stick to them.
4 - Visit the property a few times.
You’ll probably want to visit properties you’re interested in a few times. The first time to see if you like it, other times to look at it in more detail. Each time pay attention to who’s there – are you seeing the same people? Are there a lot of people or just a few? Do they look like they might be buying it as a home to live in or as an investment? All these things will give you little insights into the type of interest there is in the property and what to expect on auction day.
5 - Keep your cool
Auctions can be stressful. Expect to be nervous as you are potentially making a life-changing purchase in front of a large crowd. Stay cool, trust yourself, stick to your budget and know that there is always another property if this one doesn’t work out.
At BankVic our lending consultants will help you every step of the way to buying your first home. Get in touch by calling us on 13 63 73 or book a time with a mobile lending manager to find out how our first home buyer lending products are tailored to meet the unique needs of nurses and other health workers.