The Power of a Plan B

We often see buyers set their sights on a property they love. The excitement, the anticipation and the build up to auction day can be exhausting, and the fear of disappointment can really bite as the auction date closes in.

We always continue the search, no matter how suitable the property may seem.

We provision for auction loss because we can never predict what another bidder could stretch to.

Aside from having other options to fall back on, a Plan B can serve in quite a few other positive ways.

Firstly, it gives a buyer a bit of hope when they feel that their house of dreams has left them feeling upset after an auction loss. Without a feeling of hope, buyers can easily feel despondent about the home-buying situation.

Secondly, it puts the search into perspective. While House ‘A’ represents a lot of ticked criteria boxes, House ‘B’ reminds them that when one door closes, another will open… or that there are a lot of fish in the sea… the list of analogies goes on. Provided the search criteria is realistic, the housing market provides a constant supply and there will be others out there as long as we are looking.

Thirdly, the ‘B’ house can give us a bit of a negotiation ploy up our sleeve. Not all houses go to auction and when we face a private sale or a pass in, the ‘other’ house can be a point of discussion.

Buyers often fear “other buyers”.

It’s important to remember that vendors fear “other houses”.

Clearly we don’t suggest bluffing to the point of missing out on the preferred house, but if ‘B’ house is a genuine contender in the event of missing ‘A’, it can’t hurt to share this (provided ‘B’ doesn’t have a higher advertised price tag!)

And sometimes we find ourselves shortlisting viable options that auction on the same day for clients. Depending on the chronological order in which they go under the hammer, a multi-auction day can be an option for a motivated buyer.

Yesterday we had just that…. a client who had shortlisted not one but three viable properties for their search. Two went to auction at 10am, and 12.30pm and the third (Plan C) was a private sale townhouse in Kensington. Our challenge was interesting though….

It was the 12.30pm auction which held the most appeal.

After determining that none of the vendors were keen to sell any prior to the auction, we had to set our budget limits according to our preferences. 

Our stretch budget for house ‘B’ at 10am was not as strong as ‘A’s stretch budget and we felt this was a sensible pricing strategy.

Unsurprisingly we were the under-bidders and the two bedroom, street-frontage property in Maidstone sold under the hammer for $715,000.

Gearing up for Property ‘A’ was our priority.

Securing this gorgeous three bedroom townhouse in Moonee Ponds at 12.45pm for $690,000 was a fantastic feat for our patient buyers. Knowing that we had a Plan C gave them a sense of comfort, but seeing Plan B sell to another buyer gave them a sense of reality too.

Prepping two auction files and conducting due-diligence on three properties rewarded us. We secured the one they really wanted, and under win/win conditions. The tenant wishes to stay on, the price was good and the asset suburb location is A grade.

They gave it their best shot and their planning paid off.

Wishing them years of attractive capital growth, smooth tenancy and a happy investing journey.