Buying a home
How to bid at auction - The Auction Advantage Ep 3
15 August 2018
Nicole Jacobs, buyers advocate for Channel Nine's The Block, presents The Auction Advantage: tips to help you understand the auction process.
So you’ve done your research and you’re fully prepared for auction day. You know your bidding limits, and you’ve practised negotiating. Nicole’s got 5 key tips on what you can do to win on auction day.
[Nicole Jacobs]: My main tips for if you’re bidding at auction are:
Know your strategy before you even turn up.
Don’t get on the phone to ask for more money.
Know where you need to be on the day – and stick to it.
As soon as you start getting on the phone and asking for more money–
[Man bidding]: I’ve gotta phone a friend–
[Nicole Jacobs]: People like myself will see those verbal signs and know “great, they’re out!”
When you’re bidding, make sure you’re confident, you’re non-emotional.
Being non-emotional at the auction doesn’t allow anybody to pick up on any verbal cues that you might be putting out there.
Stand in a really prominent position so that everybody can see you and you can see everybody else.
You can watch for the verbal cues and the non-verbal cues which are critical in working out if somebody else is about to pull out of the race.
It’s really crucial to the increments the auctioneer is asking for.
Auctioneers are trained to try and get as much out of you as possible, so quite often they will nod their head up and down for you to say yes to that offer that they’re asking for.
[Auctioneer]: Maybe say 20, 30, 40, or 50.
[Nicole Jacobs]: It might be $50,000 that they’re asking for but somebody prior has given $10,000.
Why would you go in $50,000 if someone else has given $10,000?
[Auctioneer]: Two million , 3 million, 4 million Frank, give it a shot…
[Nicole Jacobs]: And watch what everybody’s bidding because if they start to bring it down to $1000 bids, it may be a key indicator that they are about to stop at their financial limit.
So if they’re asking for twenty-fives and you want to give fifteen or ten, ask them.
It’s really important that you lead the auction process and you don’t get them to lead you to spending more money.
- Know your strategy before you turn upHave your budget written down and know where you need to be on the day. You don’t want to be on the phone trying to find more money during the auction, as it sends a bad signal to other buyers that you’re about to reach your spending limit.
- Be non-emotional and confident
Try not to express your emotions during the auction and be confident when you make a bid. This shows other buyers that you’re serious and know what you’re doing.
- Stand in a really prominent position
Find a spot in the room where you can see everyone and everyone can see you. This will help you to observe the verbal and non-verbal cues of other bidders.
- Listen to the increments the Auctioneer is asking for
This is crucial. The auctioneer will often nod at you after you make a bid to confirm that you agree to the amount. If you’re in a bidding war with another buyer, it may only be in increments of $1000, which could be the difference between winning and losing.
- Take the lead
If you only want to bid in smaller increments, ask the auctioneer. They are trained to get the most money for their vendor, so don’t let them guide you through the process. You’re in control and can take the lead when it comes to making a bid and negotiating.
Ready for the next step?
Nicole takes you through how to bid at auction and what to do when it comes time to negotiate.
Read more on Learn About:
- What can I expect at auction?
- My experience buying a house at auction
- How can I estimate the total costs involved in buying a home?
Nicole Jacobs is founder and director of Nicole Jacobs Property and a licensed REIV estate agent. Nicole is passionate about helping people find their dream property and regularly appears on Channel Nine’s The Block as a buyers advocate. With nearly 20 years business experience, Nicole is a big supporter of women in real estate and empowering them to achieve their goals.
Information is intended to be of a general nature only and any advice has been prepared without taking into account any person's particular objectives, financial situation or needs. You should make your own enquiries, consider whether advice is appropriate for you and read the relevant Product Disclosure Statement or Product Information Document before making any decisions about whether to acquire a product