Reading ‘the play’ when buying at auction
Auction bunnies are home-buyers duped into bidding at auctions when they have no chance of being a successful buyer. The auction bunny reaches their maximum price at the auction before the price even hits the seller’s reserve price.
Not only do these poor bunnies often get their hearts broken, they also lose thousands of dollars in ‘due diligence expenses’ – such as building reports, pest reports, strata reports and legal expenses.
Here’s what happens : An auction bunny asks the auction agent, “How much will this property sell for?” The agent gives the standard bunny-trap reply – they quote a price around 10 to 15% below the seller’s reserve price . For example, if the sellers want a million dollars, the auction agent will say, “We’re expecting bidding to start from around $850,000.”