As an investor it is always beneficial to undertake research and analysis to understand the areas you want to invest. As part of this research have you considered auction market data?
If not, maybe this is something new to add to your list of items to research.
Even if you aren’t bidding, auctions can provide a rich source of information. Especially since 1 in 5 sales in capital cities is an auction.
If you attend some auctions to gather research the things to keep in mind are:
The Sale Price: You will be able to compare the sale prices or passed figure with your expectations of the price for the market. This data is only available the day after the auctions, unless you are in attendance.
Number of Buyers: It is always interesting to see the number of active buyers as these could be your competitors. By attending auctions you will get a sense of how strong the demand is in an area and this may influence the price you are willing to pay.
Auction Conduct: Attending auctions in your target area will allow you to become familiar with the styles of different auctioneers and therefore give you a great understanding of the competition in the area.
Clearance rates: The clearance rate aims to provide, are a snapshot of how demand and supply in the auction market is behaving. Basically what percentage of properties listed for sale at auction are actually sold. This can be a leading indicator as to how the whole market is expected to perform.
The table below represents a summary of the auction market for 2014.
If you choose to buy through an auction, as with any property purchase, don’t get swept up in the bidding process and blow your budget. Do your homework, bid with confidence and be satisfied with the result, no matter the outcome!