Emotions are running high as prices are shouted out, the auctioneer is cajoling the bidders to put their hands ever deeper into their pockets and the vendors are listening on anxiously nearby. When the gavel eventually comes down there’s cheers and, in many cases, tears.
The onsite property auction is back after months of sterile lockdown Zoom selling, just in time for the peak spring selling season.
“It’s great to have onsite auctions back,” said Brad Teal, who as well as being owner of Brad Teal Woodards is an auctioneer of 40 years’ experience, conducting around 200 per year. “You’re talking to people and engaging and relating to each other in real life.”
For buyers it’s time to refresh the strategies and tactics needed to beat the competition and secure that dream home.
Andrew Butler, head of sales and auctioneer at Brad Teal Woodards Pascoe Vale, said buyers must complete their due diligence with finance, building inspections and contract reviews before even thinking about bidding at auction.
“The most important thing is having a budget and sticking to it,” he said. “It’s OK to have a budget and a secondary budget but you don’t want to be going too high at auction and finding out you’re on rice and water for the next 20 years.”
Mr Butler said confidence was key to winning at auction. That means securing a good position onsite so you’re on the “auctioneer’s radar” and making clear, concise bids in a loud voice. “If you’re not confident, find a family member who can bid for you,” he suggested.
And don’t try to knock out your competitors with an early knock-out bid. “Let the auctioneer build the momentum,” he said. “If you go in with the killer bid and no one else bids, you’ll be lying in bed that night thinking, I’ve paid too much.”
But the buyers only represent half of the equation when it comes to auction day.
While they are looking to limit the amount they will pay for their new home, the opposite is true for the vendors, who want to achieve the maximum sale price.
Mr Teal said the hard work for the sellers takes place in the weeks before the big day. “The auction is the culmination of four weeks of marketing,” he said.
“On the day, the vendors should have enough feedback to suggest they have two, or three, or four buyers who will be bidding against each other, so the number one priority is deciding a realistic reserve.
“You’ve got to give yourself the chance to get that competitive bidding going – if you have a high reserve and you pass in, you’re not going to get it. You’ll have to negotiate down.”
Mr Teal said that while a competitive auction is usually the best way to sell, in some cases vendors should consider pre-auction offers.
“If someone comes in early during the marketing campaign with a $1.5 million offer, you might like that, but you have nothing to balance it against,” he said. “If the interest from other buyers subsequently comes in at $1.3m, $1.4m and the $1.5m is still available, you should consider selling.”
And having a property passed in at auction is not a cause for despair.
“A lot of people don’t go to auction because they’re frightened of passing in,” Mr Teal said. “But it can still deliver you a sale 10 minutes later. You’ve identified the attendees as being interested and you can negotiate one-on-one.”
To discuss the most effective strategy to sell your property, contact Brad Teal Woodards today.