“this property is perfect for my portfolio, why shouldn’t i keep bidding at auction?”
Our client was seeking an investment property to purchase. Having selected a suitable property in Roxburgh Park to target, we prepared to bid to buy the house at auction.
Attending the auction, bidding commenced and we were up against one other party. Bidding from the other party was fast and aggressive and it was clear as the price increased, that the other party had more to spend and would not drop out of the competition for some time yet.
What We Did
By having done prior market research and assessing recent comparable sales, the state of the market, scarcity of the property and the financial metrics we were needing to hit for our client we were able to determine the true value of the property and limit how high we would bid, ensuring that we did not overpay for the property.
Upon establishing that the other bidder was not slowing down, we pulled the pin on our bidding and advised the client over the phone of our reasoning.
The selling agent approached us to encourage further bidding, also knowing that the other bidder had more money to pay and attempting to drive the bidding price higher in order to achieve a better result for their vendor. We declined to do so.
The risk of continuing to bid under these circumstances is huge, had we been accidentally reading the play incorrectly, we could have wound up purchasing the property at a price that was far too high, resulting in a purchase that was counter-productive to our clients needs.
This can result in the following:-
- A shortfall between the price of the property and the bank valuation
- A purchase price that exceeds the client’s borrowing capacity
- Setting a new record for the area would drive prices of upcoming sales higher, costing our client when they eventually do successfully purchase and potentially driving us out of the area
We found Lisa to be really easy to get on with. She was extremely professional in our dealings with her.
She takes full control of the property search leaving you with really only the main decision to make of whether you want to go for a property or not.
The property we ended up with was one we didn’t even attend the auction for as Lisa went on our behalf.
We felt Lisa really aims to ensure the client experience is stress free and she takes on all of that load which is really what you want when you choose a property buyers advocate.
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