Everything you need to know before making a bid, from being finance-ready to knowing your competition, having a strategy and knowing your limits. We chat to Harris Real Estate Property Consultant, Georgie Todd.

Auctions are on the increase in SA and clearance rates are at an all-time high – why is this?

It’s a reflection of a market that has changed greatly post-pandemic, where people seek certainty more than ever before. An auction allows specificity of settlement dates and sales conditions, and an unconditional contract removes the angst of cooling off periods. For vendors, the competitive environment can create really exceptional results, and for purchasers, auctions provide complete transparency. They’re a favourite of neighbours too, offering a theatrical, real-time local market update!

What about online or in-room auctions? Are they also gaining popularity?

I don’t recommend them in the current market unless absolutely necessary. Successful auctions are all about emotion and competition, and to achieve this having the bidding out the front of the property is absolutely critical. Holding the auction online detaches the buyer, which affects the final sale price.

What do potential buyers need to know/do before making a bid?

The most vital factor is finance approval and the ability to meet an unconditional contract. Your broker can educate you on pre-approval to ensure confidence purchasing under auction terms and conditions. As there is no cooling off period, any building inspections need to be done pre-purchase – it’s worthwhile asking the selling agent if anyone else has done any.

How important is it for a potential buyer to know their competition?

It’s wise to have an idea of how competitive an auction might be, but this doesn’t affect the result. The more competition, the more likely a higher price, but it only takes two keen bidders, and ultimately a buyer will bid to what they are prepared to pay.

When is the best time to make a bid?

Everyone has a different bidding tactic. Some start with a strong first bid to try to knock out the competition, others wait until they feel the auction is starting to slow and come in to unsettle others. Talk to a real estate professional to go over what will work best for you.

What if the property is passed in? What happens next?

It’s not doom and gloom. [If passed in the property] converts to ‘for sale’ and buyers with different terms and conditions can consider the property. Most properties that don’t sell at auction are usually sold one to two weeks later.

How important are the first few weeks in any marketing campaign?

Paramount. This is when properties generate the most interest from the market as the active buyers in the market (those who are checking listings daily) will be looking at your property. It’s essential that a property presents well, is priced fairly and has a strong marketing campaign to reach the widest audience. Not doing so could mean you lose the opportunity to appeal to the best buyers in the market.

Georgie Todd
Property Consultant
0420 492 936
georgie@harrisre.com.au
@georgie_todd_realestate