Buying a property at an auction can be a roller coaster ride. The tough competition in real estate in Australia makes property auctions overwhelming for buyers. If you don’t have enough experience in home buying, auctions may not be for you. Aside from the possibility of losing hundreds of dollars, it can be hard for you to deal with the fact that the home you’ve come to love is not within your set budget.
Make sure to call out your bids confidently, but do not fall into an agent’s trap by bidding too soon
Should you decide to invest in real estate in Australia through an auction, arm yourself with knowledge to lower the risk of financial loss and emotional damage. Here are five tips to consider:
- Visit auctions before bidding. Auctions present a certain degree of uncertainty, so know what you’re getting yourself into. Besides, buying a home is an expensive affair so it is important to learn what you can about auctions before making any bids.
- Seek professional advice. A lawyer can be really helpful when buying a home as he/she can better explain the contents of any legal document and even speak to the agent on your behalf.
- Set a budget. Emotions are running high during auctions that you may make bids above your budget, especially if you really love the home. Your maximum limit can be the amount of money that you can borrow from a bank. Some get pre-approved loans before going to an auction to ensure that they will not bid more than their budget.
- Check everything. Auctions come with agents who can mislead you by giving you a quote and even fraudulent bids. Be cautious and make sure to check everything thoroughly. Also, ask questions, but when asked, don’t give definite answers.
- Confidence is key. When applying for a job, you will most likely wear a business suit because as they always say, dress to impress. The same goes for bidders. First impressions last, and if you look professional and confident, your personal appearance can work in your favour.
When inside a room, you can sit up front or stand in the back to get a view of the competition. Also, make sure to call out your bids confidently, but do not fall into an agent’s trap by bidding too soon. Going slow on the bidding can push the seller to lower the reserve price, giving you a higher chance of buying the property within your price limit.
Got other tips when investing in real estate in Australia? You can share your ideas in the comments section below.