The traditional way to purchase your next home is to look through the offerings by your real estate agent and choose the one you like and can afford. However, this is not the only option!
One option that many people overlook is to visit your local real estate auctioneer and see what properties they have coming up. There is plenty of potential to purchase a home for a lot less than it is worth. However, it is also possible to get a property that needs a lot more work than you thought.
That’s why it is essential to decide what risk you are willing to take and how to bid on your desired property to ensure you win.
Know Your Budget
The key to successfully bidding on a property is to decide your budget before you even get to the auction. This amount is the limit of your bidding. Don’t forget you have very little time to settle a winning bid, most auctioneers want the funds transferred within 7-14 days.
In other words, stay within your budget to ensure you can complete the purchase.
Choose the Location
Different auction houses tend to cover different districts. That means before you start bidding you need to think about the locations that appeal to you. You can then visit the auctioneer that is selling properties in the desired area. This makes it more likely that you’ll get a property you actually want.
The secret to successful bidding is to suss out your competition and push them gently to their limit before you reach yours. The best way to get good at doing this is to visit several auctions first and avoid bidding on anything. Instead, you can watch how others do it and build your own confidence.
It is a good idea to visit small auctions and even make a few bids, as long as it is either something you want or something you can’t possibly win.
Perhaps the most important step of the process is to do a little research. The auction catalogue is usually released a week or two before the auction. This gives you an opportunity to look at the listed properties, assess their area and the likely damage inside the home.
This will help you to decide the top price that you are willing to pay for the property. Once you have this figure you should stick to it. It will make budgeting and finance so much easier.
Have A Reserve
It is a good idea to get to any auction early as this should help you relax, assess who else is interested in the same property, and choose the right location to bid from.
You can indulge in setting yourself a reserve which could be useful if you need to make that extra bid to secure the property you really want. Having it as a reserve helps you to remember that this is taking you close to your limits and gives you the opportunity to confirm that this is the right property for you.