A Guide To Buying At Auctions (Part 2)
Last week, I talked about the preparation needed before buying property at an auction. This time, I’ll be wrapping up this series by sharing with you some tips on what to do on auction day.
The Early Bird Gets The Worm
During auction day, make it a point to arrive early at the venue. When you arrive before the other bidders, not only will you get a seat within the purview of the auctioneer, but you will also get a chance to familiarise yourself with the auction room. Remember, the venue gets crowded pretty easily. If you arrive late, you’ll get lost in the sea of people in the room.
Now that you’ve arrived, the next step is to find the registration area. Some auction houses follow this protocol when they allow early bidding on houses. So no registration, means no early bidding for you.
Before you leave the registration area, don’t forget to snag a copy of the addendum sheet. These leaflets contain any alternations on details provided in the auction catalogue. It’s also used to show the updated list of houses sold on auction day, because some sellers pull out their houses from the roster at the last minute, while other houses get sold even before the date itself.
If for some reason you can’t physically attend the auction, you can still participate in the bidding through a letter or over the telephone. You can just contact the auction house that you’re dealing with to find out their rules.
The actual bidding process is very exciting. There are no other words to describe it.
If you don’t want to mess up your first buy, you can try doing a dummy run and attend an auction as a spectator first. This way you’ll have an idea how the entire process works before you even participate in one.
When they open the bid for the house you want. Don’t get carried away by the excitement in the room. Set a cap for how much you’re willing to bid and never, ever go over it. If you can’t trust yourself to stay on budget, it’s wiser to let another person make the bids for you.
In case the house you’re bidding on doesn’t reach its reserve price, the auctioneers can still broker a deal between you and the seller if both parties can agree at a favourable price. Just remember to leave your contact details to the auctioneer before you leave the venue.
The auctioneer is the boss of the auction room. He has the final decision on when the bidding starts, stops, and even if it’s going to be cancelled. He’s also responsible for scouring bids around the venue and has the power to refuse a bid without giving an explanation for it.
Last but not least, a sale is confirmed when the hammer falls and at this point the highest bidder is bound by a binding contract.
I hope you enjoyed this series on how to buy houses at auctions. Make sure to check my site next week for another exciting topic!