19 January, 2017 / Category: News
So you’re in the market to purchase a property in 2017 – congratulations! Now it’s time for to buy, but more than that – it’s time to buy well. In today’s blog from Infolio Property Advisors, Managing Director Lauren Staley shares hard-won insights from her extensive advocacy experience, explaining how a buyer’s success rate at auction can be improved with some carefully considered tactics.
Setting up a strategy
The first thing to do when readying yourself to buy at auction is to define your strategy. Don’t leave anything to chance. Purchasing at auction is not always about who has the most experience – a savvy first homebuyer can trump the most seasoned of investors if they’ve prepared themselves to bid with confidence. This strategy includes simple (but often left-to-the-last-minute) factors like having your finance prepared, working with a lawyer or conveyancer to ensure the auction contract is appropriate and having a hard bidding limit.
Know what it’s worth
When it comes to real estate in Melbourne, a property’s actual value, its quoted price and its eventual sale price at auction are rarely the same thing! Buying well means paying a fair price for your asset. Infolio buyer advocates work with their clients to reveal a clear picture of true property value, based upon a variety of market indicators. Having a clear understanding of a property’s value allows you to develop a more effective bidding strategy – and it gives you the motivation you need to walk away from an auction if it becomes an overheated bidding war. Alternately, you may be the only bidder at an auction with the confidence to make an informed ‘knock-out’ bid, dousing the hopes of any competing purchasers in one fell swoop.
Put on your poker face
Are you the kind of property buyer that wears your heart on your sleeve? It is valuable to work with a buyer’s advocate who can act on your behalf if this is the case. The manner in which you bid and behave in the auction space can directly affect a property acquisition outcome. An inexperienced buyer’s behaviour at open for inspections and during conversations with estate agents about an asset they’re interested in purchasing can also impact upon negatively upon their purchasing power. Loose lips about budgets can put buyers at a disadvantage should a property be passed in to them – so exercise caution and discretion, no matter how friendly the real estate professional.
Don’t be an ass
It might sound intuitive, but understanding (and respecting!) auction etiquette can make a difference, too. Buyers who try to control the auction, condescend to others or put their competition off with derogatory remarks about the property only show their hand! (And their poor manners into the bargain.) Just be affable and show estate agents, fellow bidders and the vendor common courtesy.
Get your ducks in a row
Don’t think of the necessary research and preparation you’ll need to undertake to buy a property well as dull homework. The financial gain you’ll enjoy from making a good purchase will remunerate you far better than any job could! Take the time to set your budget in collaboration with trusted advisors such as buyers’ advocates and brokers, have all terms and conditions agreed to prior to auction and define your strategy. Will you make a bold knock-out bid or will you sit and wait? Is your strategy to create a ‘pass in’ situation? Good tactics make all the difference to buying well.
If you’d like professional assistance making a better buy when it comes to your next home or investment property, Infolio Property Advisors can help. Your initial, 45-minute consultation is free! Contact our friendly team here.