By Clarence White
I’ve been lucky in my career to work with high performing auction agents. It’s no fluke that these agents tend to sell more often under the hammer and for higher prices than their competitors.
Their success strategies are simple, but they understand exactly what to do, when to do it and how to communicate with buyers and sellers.
Securing an opening bid
The best start to an auction is if a paddle goes straight up once the auctioneer calls for an opening bid.
It is a strong message to all bidders that they must compete to secure the property. It is also a powerful statement to onlookers that the agent has done their groundwork and prepared their buyers.
The good news is, this scenario is easy to create. The secret lies in pre-auction conversations with buyers by the agent or the auctioneer.
Agent/Auctioneer: Mr Buyer, I thought I might kick things off around (pick a figure approx. 10–15 per cent below the likely result) today, would you feel comfortable getting me started at that level?
Agent/Auctioneer: Could I call on you for an opening bid?
Buyer: I don’t want to start today/I might just see what happens.
Agent/Auctioneer: Mr Buyer, you realise that if everyone does that we all just stand around and stare at each other? Wouldn’t you rather take control from the start? Research shows the opening bidder ends up being the buyer in 80 per cent of auctions?
When to work the floor
As the selling agent, timing your approach to buyers during an auction is crucial.
If you’re too early you risk killing the momentum. If you’re too late you risk stalling the auction. If you don’t approach your buyers at all, frankly, you’re not doing your job.
So when is the right time?
Generally, if things are humming along, leave the buyers alone. If it ain’t broke, don’t fix it.
Approaching a buyer when they are already bidding well will just annoy them.
The time to make your first approach is the moment things stall. When the auctioneer trial closes (once, twice, third) and no bid is forthcoming, you should head out immediately to speak to the underbidder(s).
If you can’t get them to bid, then approach any registered parties who have not yet bid. If none of those parties are willing to bid, approach the highest bidder for an increased bid.
Even if there has been spirited bidding and we are above reserve, always approach the underbidder before you give the auctioneer instructions to sell, just to see if you can give them a little encouragement to go one more. If nothing else, you are ensuring you did everything to secure the best price for your client.
In my opinion, there is no excuse for not working the floor during an auction. Just because we are above reserve does not mean we stop working for the best result.
Sometimes a friendly word of encouragement is enough to get another $5,000, $10,000 or even $20,000 from a bidder. That’s what we get paid to do. Plus, you’ll look good in front of the crowd if you can achieve it.