If bidding in seal bid sale should one make their maximum bid immediately?

GervisLooper

Another thought I had is if the expectation is you should put forward your best bid right away shouldn't the guide price be more in line with what they are expecting as the true value rather than artificially low to encourage bidding as seems to sometimes be the case with private treaty sales.

RHemmings

user1977 said:

eddddy said:

GervisLooper said:

It is the former I think because it says offers must be sent to X address and will be opened on Y date, over a month from now in July.

Hmm just thinking, this wait is enough of a nuisance but then it could be another month before getting it all sorted couldn't it?

I will be bidding for (wood)land btw which should be more simple than for bricks and mortar I guess.

And if bids aren't going to be opened until a date in July, there's no real point in making your bid until a day or two beforehand. (In case you find something else you prefer in the meantime.)

Or in case your bid somehow becomes "unsealed" to enable somebody to offer just over it. Normal practice in Scottish closing dates is to fire in your offer at the last minute to deter that sort of shenanigans.

I was thinking that strategy would also allow maximum freedom for the bidder - as they are free to make bids on other properties in the meantime if they find something better. At least for me, because I would feel psychologically committed once I had made the bid, and wouldn't want to just withdraw it before or after the bid won. (Assuming it does.) 

user1977

GervisLooper said:

Another thought I had is if the expectation is you should put forward your best bid right away shouldn't the guide price be more in line with what they are expecting as the true value rather than artificially low to encourage bidding as seems to sometimes be the case with private treaty sales.

Not particularly. Auctions often have artificially low guide prices. Asking prices in Scotland (before Home Reports came in and everybody knew what the surveyor's valuation was) used to often be low, to sucker people in - the guide price isn't all that relevant once you have a bunch of bidders, everybody will make their own assessment of what it's worth.

GervisLooper

user1977 said:

GervisLooper said:

Another thought I had is if the expectation is you should put forward your best bid right away shouldn't the guide price be more in line with what they are expecting as the true value rather than artificially low to encourage bidding as seems to sometimes be the case with private treaty sales.

Not particularly. Auctions often have artificially low guide prices. Asking prices in Scotland (before Home Reports came in and everybody knew what the surveyor's valuation was) used to often be low, to sucker people in - the guide price isn't all that relevant once you have a bunch of bidders, everybody will make their own assessment of what it's worth.

Yes but isn't the whole point the bidders are left in the dark mostly about what is going on behind the scenes? So how would they know there are a bunch of bidders?

Or are the amount of bidders made public to other bidders, just not what they bid?

user1977

GervisLooper said:

user1977 said:

GervisLooper said:

Another thought I had is if the expectation is you should put forward your best bid right away shouldn't the guide price be more in line with what they are expecting as the true value rather than artificially low to encourage bidding as seems to sometimes be the case with private treaty sales.

Not particularly. Auctions often have artificially low guide prices. Asking prices in Scotland (before Home Reports came in and everybody knew what the surveyor's valuation was) used to often be low, to sucker people in - the guide price isn't all that relevant once you have a bunch of bidders, everybody will make their own assessment of what it's worth.

Yes but isn't the whole point the bidders are left in the dark mostly about what is going on behind the scenes? So how would they know there are a bunch of bidders?

Or are the amount of bidders made public to other bidders, just not what they bid?

You'll generally get an idea from the agents of how many other interested parties there are.

Herzlos

GervisLooper said:

user1977 said:

GervisLooper said:

Another thought I had is if the expectation is you should put forward your best bid right away shouldn't the guide price be more in line with what they are expecting as the true value rather than artificially low to encourage bidding as seems to sometimes be the case with private treaty sales.

Not particularly. Auctions often have artificially low guide prices. Asking prices in Scotland (before Home Reports came in and everybody knew what the surveyor's valuation was) used to often be low, to sucker people in - the guide price isn't all that relevant once you have a bunch of bidders, everybody will make their own assessment of what it's worth.

Yes but isn't the whole point the bidders are left in the dark mostly about what is going on behind the scenes? So how would they know there are a bunch of bidders?

Or are the amount of bidders made public to other bidders, just not what they bid?

When buying, our EA told us he was expecting 3-4 offers, and confirmed that the offer we were making had a reasonable chance of success, but he couldn't tell us exact numbers or the details of the other bidders. Of course, how much of that is just sales speak is impossible to tell later.

There were definitely a few bids though, as it turned out later we knew one of them (and beat them by almost nothing).