I’m frequently asked “how should I bid at auction?”
and here are a few of my tips: TIP #1 — Participation is the key
People often hold back from bidding until the auctioneer declares the property ‘on the
market’, but it’s really important to realise that if the property is passed in, the person
to whom it’s passed in gets first right of refusal to negotiate at the reserve price
with the selling agent. You will miss that right if you don’t actually bid at the auction
and have it passed in to you. TIP #2 — Setting a flexible limit
So often people come to an auction with a rigid limit and then leave, really thinking
that perhaps they may have gone another five or eight thousand dollars and perhaps have
bought the property if they have just missed. Have that conversation with yourself before
you get to the auction, even the night before so you’ve got a limit and a fall-back position.
Another really good part of this tip is to have a limit that doesn’t end in a zero or
a five. So many people come to an auction with a limit that ends in a zero or a five
and then don’t give themselves any flexibility. Have a limit that ends in a three or a three
and a half or seven or seven and a half. In other words, if you’re happy to pay five hundred,
have a limit of five hundred and three in your mind. Bid as though five hundred is your
limit but be prepared to jump that limit. That may be the bid that gets you the property.
Don’t be too hard on yourself with rigidity. TIP #3 — Take a stand
Take up a position where you can clearly hear the auctioneer and see the other bidders and
there will be no need for you to walk forward when you feel you’re ready to bid. Take up
the position at the start, stay in that position and bid from that position. The reason this
is important, and very often, if you walk to a better position during the auction, you’ll
give away your intention to bid. TIP #4 — Control the bidding
If you’re bidding before the property has been declared ‘on the market’, which you may
be doing from the point of view of getting first right of refusal, really doesn’t matter
that those bids could be in five or even ten thousand dollar rises. Once the property is
back on the market, bring the bidding back to the minimum amount acceptable by the auctioneer,
but don’t be afraid to adjust those figures. TIP #5 — Know thy competition
And also remember, as my last tip, that you’re not bidding against the auctioneer, you’re
bidding against the others bidding, so bid fast and confidently after their bid. Waiting
for the auctioneer to count to three means nothing, what proves something is your ability
and your willingness to bid hard confidently and fast over the top of other bidders.
So I hope those tips are of some help to you. I’ll see you at the auction!