How to Prepare Yourself for an Auction

Auction day can be a pretty nerve racking experience, but if you’re prepared things will go much more smoothly. Here are a few simple tips to get you all set for auction day.

Set a Limit

The first thing you should do, and probably the most important, is to set yourself a price limit. It’s possible to get carried away in the auction room so it’s vital that you approach an auction with a clear plan and solid limits.

Once you’re set on a property, find out exactly how much it’s worth. What’s a good price, what would be paying too much, and how much can you afford? No matter how quickly things move at auction you must keep these amounts in mind and stick to them. The last thing you want is to walk away from the auction with a winning bid that’s more than you can afford or more than the house is worth.

Speak to an Agent

During the house-hunting and auction process it’s a great idea to have an agent who can help you with all the finer details of buying a home. From the legal issues to knowing the market to how to conduct yourself at auction, a good agent will have lots of tips, tricks and sage advice.

Have Your Loan Pre-Approved

Seek pre-approval on your home loan so that once you do secure that winning bid at auction you’ve already got the money ready to go so that things can move forward on the purchase straight away.

There’s a change that if you’re home loan hasn't been approved when you enter into contract negotiations the sale may be jeopardized  The last thing you’d want would be to find the perfect property, snap it up at auction for a bargain, only to have your loan held up or even denied once it’s time to sign the contract.

Attend the Open House

Before bidding on a property, you must attend the open house whether you intend to live there, rent it out or sell it on. If you’re going to make it your home, it should feel livable and you should be able to envisage yourself living there and making it your own. Does it have everything you need?

If you’re going to rent it out or sell it on, do you think you can profit from the purchase? Does it possess the qualities that are in demand by renters or buyers? Will it appeal to others?

By attending the open house you get to explore the property inside and out before making the major decision to place a serious bid at auction and you’ll get a much better idea of how much you’ll be bidding too.

Do Your Research

Attend other auctions for similar properties in the area. This will help you familiarize yourself with the auction process and give you an idea about what kind of bids you can expect to be competing with as well as actual settling prices for comparable house and land packages. You should also do plenty of research into the area to make sure the property suits your needs. How’s the commute to work? Are there good schools or day-care facilities in the area? How about hospitals, shops and other amenities that you may need?

Work with your agent to look into sales in the area too, to give you an accurate idea of how much you should be paying at auction. Are property values trending upwards? What kind of rent do comparable properties in the area attract? Find out as much as you can before auction day so you’re making a fully informed decision.

Follow these simple tips and you’ll find that when it comes to auction day you’ll be totally prepared, confident and ready to roll.