Thinking of buying a property at auction?
Navigating the auction process can be exciting, fast-paced – and at times, a little overwhelming, especially for first-time buyers. Preparation is key to making confident, informed decisions when bidding. Whether you’re just starting your property journey or looking to sharpen your strategy, we’ve put together a guide to help you approach auction day with clarity, confidence and a competitive edge.
Determine Property Value and Set a Budget
Research recent comparable sales, explore the neighbourhood, talk to agents and even locals to understand what the property is worth. Use this research to set a firm price limit and stick to it. Avoid round numbers, most people stop at them. A slightly higher but specific limit (e.g., $622,500 instead of $620,000) may give you an edge.
Understand the Auctioneer and the Process
Not all auctioneers operate the same way. Attend a variety of auctions to learn how they run, how bidders behave, and the typical flow of events.
Get Legal and Financial Affairs in Order Early
Engage a solicitor/conveyancer to review the contract of sale before the auction and confirm that your loan is pre-approved with your bank or broker. Auctions result in an unconditional sale, so you must be ready to pay the deposit and follow through with settlement if you win.
Conduct All Inspections Before Auction Day
Have building and pest inspections completed prior to the auction. This protects you from potential nasty surprises and ensures you’re comfortable proceeding with an unconditional sale if you’re the successful bidder.
Negotiate Terms in Advance
You may want to negotiate to alter the terms of settlement, the amount of deposit, or the chattels that are included. But if you want to change any of the conditions in the contract of sale, you must request this before the auction, not after the bidding has finished.
Consider Seeking Help With Your Bidding
If the thought of bidding makes you nervous, bring along someone experienced. A friend or family member may be able to assist, and our team is always available on the day to help with your bidding.
Attend and Observe Other Auctions
Going to other auctions beforehand helps you understand real-time bidding strategies and how final sale prices often differ from advertised ranges. This helps sharpen your instincts and prepares you for what to expect.
Be Bold but Strategic on Auction Day
Arrive early, inspect the property again, and check in with the selling agent. Consider placing the opening bid – it shows you’re serious and can set the tone. Be clear, confident, and assertive with your bids to discourage hesitant competitors.
Be Prepared to Act Immediately If You’re Successful
If you’re the successful bidder, you’ll need to pay the deposit (typically 10%) and sign the contract on the spot. If bidding remotely, arrangements must be made ahead of time so contracts can be signed immediately.
If the Property Passes In, Stay Engaged
If bidding doesn’t reach reserve, and the property is passed in, the highest bidder is usually given the first right to negotiate with the vendor. Being the top bidder in this case could still result in a successful purchase, often on favourable terms.