Being prepared for an auction
1. Do your homework
To get an idea of the market value of a property, start making a list of recently sold properties in the area you want to buy in and the prices they have gone for.
Remember the original listed price may not be the reserve price (minimum amount the seller is willing to accept) so keep an eye on the real estate prices and ask local real estate agents for auction
2. Go to auctions!
Becoming comfortable with the auction process is just like learning anything new in life - the more practice and exposure you have, the better. Attend as many auctions as you can to get an idea of what actually happens on the day, from the rules and procedures to the strategies of the winning bidder.
Attending auctions in the suburbs you are hoping to buy a property in will also give you a realistic idea of the prices properties end up going for, compared to the listed price.
3. Inspect before you bid
Property inspection really is one of the most important parts of the buying process. Visit the property a few times and get to know it inside and out, and if you decide it's your dream home get the professionals in (building and pest inspectors, plus an architect) before auction day.
It's also a good idea to ask your solicitor to look over any contracts before auction day.
4. Get your finances sorted
If you're the winning bidder on auction day you'll need to have the deposit bond, which is usually 10 per cent of the purchase price.
Your home loan should also be secured before auction day. Once you know you're ready to buy get in touch with your lender. That way you'll know well ahead of auction day your set limit - just remember to stick to it!
If you've reached your limit but find yourself getting swept up in the excitement of bidding, just walk out of the room or away from the action. There will always be another home on the market.
5. Be confident on the day and enjoy the experience
If you're intending to bid, arrive early on the day to register with your identification (usually a driver's license is enough). Keep in mind that just because you've registered doesn't mean you have to place a bid if you change your mind.
Most importantly, try to keep calm and just enjoy the experience of being at an auction. Bid confidently and remember you're just as prepared as the other bidders there.
Please note: This is only intended as a general guide in relation to issues you may want to consider when preparing for an auction. It is not intended to be an exhaustive list of all relevant issues and you should take into account your own particular circumstances, and obtain independent expert advice where needed, before proceeding.