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Bidding for a home: Tips to prepare you for an auction

By Andrew Bell

If you’re interested in taking out a home loan in the near future and purchasing Surfers Paradise property, chances are you’ll come up against an auction at some point during your search. This sales method is fast becoming one of the most popular across Australia and can prove to be lucrative for both buyer and seller.

However, approaching auctions as a new buyer can be an intimidating experience. Unlike private sales, the competitive nature of the sale can be confronting and scary, especially when you’re face-to-face with other people who are equally as anxious to come out on top and secure a slice of real estate. Luckily, like everything in life, proper preparation is the key to your future success story in the property market.

Here are some tips to help you prepare for the auction market in Surfers Paradise.

Market research is essential

Even before you start looking online and in real estate magazines for property in Surfers Paradise, it’s important to do you research. With access to the internet, you’re able to look into a wide range of different statistics and sets of data about the local region and community, which can help adequately prepare your expectations. An understanding of auction clearance rates, median home prices and local rental yields (for investment property) will help you make an informed decision.

Furthermore, purchasing property is a big investment on your behalf. You’ll want to ensure your potential future home is surrounded by good infrastructure. Keep an eye out for things like shopping malls, schools and public transport links – especially if you’re planning on making the commute to and from work every day.

Organise your home loan early

As a novice buyer, these experiences can be overwhelming. However, the one thing to ensure you take care of is the financial side of your property journey. Speaking with a home loan expert about your options before approaching the market can help you understand not only the type of mortgage you’ll be looking into, but also how much you’ll be able to borrow – which can help narrow down your short list of potential properties to choose from.

Getting a home loan pre-approval is also another thing to seek. With auctions, the transferral of a deposit is often a very quick process – usually directly following the conclusion of the auction. Being able to move this fast will be an essential thing to do, so having your mortgage already pre-approved and ready to go will be a great help in the long run.

The auction process

Once you’re ready to go and standing in the auction arena, you’ll no doubt have a thousand thoughts running through your mind. It could be worth visiting a few auctions prior to your own, in order to gain an insight into the atmosphere and how they work so you won’t be blind sided on the fateful day. The main thing to remember is to remain calm and keep a cool head.

Another way to facilitate auction success is to have a set spending limit that you won’t break for anything. It’s easy to get caught up in the competitive heat of the auction, but be wary. It’s better to miss out on a property than to overextend yourself financially and end up committing to a debt you’re unable to comfortably repay. There will always be other houses, but keeping you and your family financially secure is the most important thing.

These are just some basics tips to help you prepare for any auctions you take part in. Speaking with a real estate professional will provide you with more insight and a professional guide through the competitive – but rewarding – world of auctions.

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