Why I love buying at auction

Why I love buying at auction

In my experience I would say very few properties sell for fair money at auction.  The majority of properties are either sold for over fair money to emotional buyers who are not prepared or they are sold at a price which is below fair money to a lucky or an astute, well researched buyer with a plan and options – which is why I love buying at auction.  If you go to an auction well researched and prepared you either win and purchase a property at a price you’re happy to pay or you don’t buy, so either way it’s a good outcome.

For most buyers there’s enormous pressure and emotion on auction day for several reasons - in particular they aren’t experienced in that environment. However as an ex-selling agent and very experienced buyer’s agent I am able to focus on the job at hand.  For me it’s all about the bidding strategy, sticking to a pre-determined budget and buying value for money.

I like buying at auction because:

  • There’s a fair chance the vendor is on a tight time frame and has committed elsewhere.
  • The vendor is the one under more pressure than the buyer as the buyer could buy many properties but the vendor only has one to sell.
  • Auctions also scare off many buyers which is great as it reduces the competition.  
  • There’s no gazumping with an auction and it’s a more transparent negotiation process once the auction is under way.

Sure you have to be careful of dummy bidders but you generally have to deal with them in a private treaty negotiation anyway as you never really know if the selling agent has another buyer on the property or not even when they say they do. 

So provided you have set a sensible, well researched limit and have options then you stand a good chance of buying very well. So take a little time to think about this before you turn your back on property that’s up for auction.  If you don’t like or feel confident in the auction environment then do what most switched on buyers do, hire someone who does! 

Categories: Auctions