Auctions are an exciting event to be a part of, but that excitement can quickly turn to anxiety if you are unprepared and haven't done your homework. To help you make the most of auctions in January, and ensure your bids are confident, coherent and successful, we've compiled a list of auction advice to help you keep cool on the big day.
You wouldn't buy a car without taking it for a test drive, so why should you buy a commercial property without doing your homework?
To get the most out of your day at auction, you can study sales figures or visit a number of other auctions prior to the one you plan to bid at. Similar properties in the same area may allow you to work out an estimate of the market value of your intended property.
It's crucial you know what the property is worth to you and that you arrive at the auction with a number of figures in mind. Three is always a good bet, such as the dream price you'd like to get it at, a price that you think reflects its true value and a limit price of what you'd be prepared to pay if you had to.
You can also use this strategy at other auctions while silently observing. Bid in your head and see what properties go for. If your estimates are too low, you may be disappointed on the big day. Remember, nothing is set in stone with auctions – so don't fret if your big day doesn't turn out the way you expected.
Asking someone with real-estate experience to bid on your behalf is a good idea for a couple of reasons. The first is that if you think having to bid will place pressure on you, making you anxious or nervous, then a cooler head will make sure you don't make any silly bids or miss out due to nerves.
The final reason is psychological. Having a professional, or someone known in the auction world, to bid on your behalf may very well scare away the competition. While this isn't always the case, it could make the difference on the day.
If you do decide to bid on your own, common advice is to not bid until you have to. Think about the figures you have in your mind, and bid when the price begins to reach the lower of the three. This may help dissuade bargain hunters and those with lower figures in mind from continuing, and will also show that you're serious about purchasing the property.
There is conflicting advice on whether to bid big first or wait – again, the best method is to do your homework and evaluate the landscape of the auction and the competition.
On the day, make sure you watch the room and evaluate your competition. Analyse their body language and how they are bidding, and try not to give too much away. Remember, you're not the only one who's wanting to get a bargain – there will be other people scouting and trying to read you as well.
Think of bidding as a game of poker: you want to keep your cards close to your chest and not give anything away until the time is right. If you want to take the pot – you'll need a good poker face.
Buying commercial property on the Gold Coast is exciting, so get in touch with the commercial team at Ray White to learn more.