Tuesday, 5 August 2014

Auction technique

Every real estate auction is different, and - apart from knowing what your upper limit is - there's no one rule for bidders that's invariably applicable.    However, as a long-term observer of the auction scene, I do know that agents' usual advice to "bid strongly" is not necessarily the way to go.  It seems to me that often it just communicates to the auctioneer that you're interested - with the risk that the price might drift upwards before the property is put on the market, and that this is likely to more than off-set any possible effect of "scaring off" other bidders.

Be that as it may, we recently attended a nearby auction, where there were two bidders, both quite diffident.  True, it was an executor's sale, but successful purchaser impressed me.  She dithered in her bids, asked for time to consult her husband, suggested a coffee break and generally gave every indication of being indecisive.   Perhaps she was - but I wondered if it was all an act?   Because the upshot was that the auctioneer put the property "on the market" at what I considered to be quite a low figure, and the consensus amongst the neighbours (who watch these things very closely!) was that eventual sale price was very reasonable.

I still don't know whether the "strategy" was by accident or design....but I came away impressed.

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