The emotional auction game

The article in the SMH on May 24 called ‘Emotion runs high as an era ends’ shows just how easy it is for bidders to get carried away with the auction day hype. The article says the successful buyers bid $35,000 dollars above their pre-auction maximum bid price to purchase the property as a relative spurred them on to keep bidding. I hear this type of story all the time and stress again and again how important it is for prospective buyers to set a maximum bid price based on research and stick to it.

In this case, I’m not familiar with the property and don’t know if the purchase price was fair or inflated or whether the buyers could easily afford the extra price tag. However there are many stories where bidders get so carried away with the auction emotion that their maximum bid price goes out the window and they pay far more than they can afford, and in many cases far more than they should have, leading to ongoing financial stress that impacts on the whole family for years to come. A mistake they will pay for "with interest".

If you're not certain you will stick to your maximum bid price then I suggest you stay away on auction day and get a trusted friend to bid for you or alternatively the wisest option would be to engage an expert to represent you – it’s what the astute buyers do.