Guys - I have never been keen on auctions and never actually bought a property in an auction but I've been to a few and noticed one thing I still don't quite understand - Vendor's bid or bid on Vendor's behalf. What is it good for?
Let's assume the bidding doesn't reach the reserve - as I understand it the highest bidder has the first right to negotiate with the vendor. What happens if the highest bid is the vendor's? Does the highest buyer-bidder still get the right to negotiate fist or is the property passed and becomes "by negotiation" by general public?
What I mean is - my wife fell in love with a new family home and convinced me to bid in the auction (we're under 80% LVR so all good). We want to bid to $700k but I guess it will be below the reserve. On the other hand at this price range I don't expect much competition, not right now anyway. Obviously once the reserve is reached the sale is unconditional and all that. But until it's reached - how to keep the price down with vendor bids pumping it up and up?
Does it actually make any sense to bid against the "vendor" if there's only one real bidder? I say $600k, auctioneers goes $610k vendor's bid, if there's noone else do I have to go $620k? Or should I let it pass? Am I still the highest bidder in that case?
BTW any tips and tricks for playing the auction to our advantage if there are multiple bidders?
Thanks!
Let's assume the bidding doesn't reach the reserve - as I understand it the highest bidder has the first right to negotiate with the vendor. What happens if the highest bid is the vendor's? Does the highest buyer-bidder still get the right to negotiate fist or is the property passed and becomes "by negotiation" by general public?
What I mean is - my wife fell in love with a new family home and convinced me to bid in the auction (we're under 80% LVR so all good). We want to bid to $700k but I guess it will be below the reserve. On the other hand at this price range I don't expect much competition, not right now anyway. Obviously once the reserve is reached the sale is unconditional and all that. But until it's reached - how to keep the price down with vendor bids pumping it up and up?
Does it actually make any sense to bid against the "vendor" if there's only one real bidder? I say $600k, auctioneers goes $610k vendor's bid, if there's noone else do I have to go $620k? Or should I let it pass? Am I still the highest bidder in that case?
BTW any tips and tricks for playing the auction to our advantage if there are multiple bidders?
Thanks!
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