How to win at auction
In this second to last blog in our series about what it takes to become a commercial property investor, we give you all our insider tips for how to win at auction.So, it’s auction day. If this is your first rodeo, chances are your heart is racing and you are more than a little nervous. But even if you are a seasoned auction goer, you probably still have more than your share of nervous energy.
Fact is, auctions are a nerve-racking business, even for the most experienced of us. While it may seem like it all comes down to who has the deepest pockets plus a bit of old-fashioned luck on the day, that’s not to say you can’t increase your chances with a few tricks of the game to help buy a commercial property at auction.
Eyes wide open
Do your research. Remember, auctions are unconditional and the last thing you want is to be lumped with a lemon because you haven’t done your homework.
Confidence is king
Be bold. Bid quickly, loudly and confidently. This shows your competitors that you mean business.
Body language counts
Your body language says more about you than what you say. Stand proud and let your competitors know that you are there to win.
Do the math
Come armed with not one limit but three limits: 1. the price you’d love to pay, 2. the maximum you want to pay and 3. the price you’ll pay under sufferance – this is the one you keep up your sleeve for emergencies and you must stop when you reach it.
Pick an odd number
When you’re setting your limits, avoid round numbers, this is where your competition will stop. An extra $1000 could be all it takes.
Get in early
Bidding early will help settle the nerves. Bidding quickly thereafter will keep the heat of you and keep it on your competitors.
Keep control
Although the auctioneer will increase bidding in increments, it doesn’t mean you have to meet them. You can still bid higher or lower. Also, feel free to ask questions, both before the auction and even during if you want to clarify anything.
Don’t save the best for last
Auctions have been won with one strong bid. The advantage of bidding high and early is that you can knock out half the competition in one foul swoop. It also puts the wind up your competitors.Auctions can be tense, emotionally charged and intimidating. It’s a good idea to attend a few as an observer if you are new to the game. Finally, if you lack confidence, ask a real estate agent to bid on your behalf – they know what they are doing and are not emotionally invested.
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