The “Auction FOMO” effect: Are buyers paying too much for fear of missing out?

If you’ve been there on auction day, you’ll have seen a crowded Saturday auction, bidders shoulder to shoulder, the air thick with nerves.

The gavel goes up, the numbers climb, and suddenly someone throws in one last desperate bid.

Did they really want the property at that price, or did they just not want to walk away empty handed?

That’s the “auction FOMO” effect.

Buyers aren’t just competing with each other, they’re wrestling with their own fear of missing out.

And for sales agents, it’s a tricky thing to navigate. Do you lean into the hype or help keep emotions from running the show?

Let’s unpack what’s happening in the market, why buyer behaviour is so jumpy, and how you, as an agent, can guide people through the chaos without killing the buzz.

Auctions are back in fashion

Even with affordability still stretched, auctions are hot right now – Sydney auctions are clearing above 70%, Melbourne clocked in at 70.4% and Brisbane hit 74.5% in late July.

That kind of momentum builds a real “fear of missing out” pressure cooker, especially in suburbs where supply is tight.

This urgency is part of why auctions often outperform private treaty sales.

But urgency doesn’t always equal rational decision making.

What FOMO looks like in practice

These days, it’s not just emotions driving decisions – it’s also transparency gaps.

In Sydney and Perth, as many as 20% and 18% of properties sell for more than 10% above the agent’s guide price, a practice known as underquoting.

Imagine budgeting for a property only to find it lands hundreds of thousands over your limit before you’ve even weighed in.

Once the bid is in, it’s too late. Buyers can feel both the thrill of winning and the sting of overspending – and that’s the real FOMO effect in action.

Why it matters for sales agents

So, why should you care if buyers overspend?

After all, higher hammer prices look good on paper.

The short answer: relationships.

Your role is about building trust and repeat business. If buyers consistently feel they’ve been pushed into paying more than they should, that trust erodes fast.

How to keep buyers grounded (without losing the buzz)

Here’s where smart sales agents earn their stripes.

Your job isn’t to kill the excitement of auctions – it’s to channel it so buyers still walk away feeling good about the process.

A few ways to do that:

• ‍Educate before the big day. Encourage buyers to get clear on their ceiling and remind them why it’s there. If you have valuation reports or local market insights handy, share them. A number backed by data sticks better than one pulled from thin air.‍
• Highlight options. If buyers miss out on one property, make sure they know there are others coming up. Keep your Reapit Sales listings updated and show them that walking away doesn’t mean walking into a dead market.‍
• Read the room. Part of your job is people watching. If someone looks like they’re spiralling into FOMO bidding, acknowledge it. A gentle reminder like, “Make sure you’re comfortable with your bid” can actually build long-term credibility.‍
• Keep communication open. Post-auction, whether they win or lose, follow up. Congratulate the winners but also check in on those who walked away. Position yourself as the voice of reason, not just the auction hype machine.

Looking at the bigger picture

The FOMO effect isn’t new, but it feels sharper when supply is tight and demand is strong despite economic headwinds.

If buyers are consistently paying over the odds, it skews expectations and makes affordability even tougher.

As sales agents, you’re right in the middle of it.

You can’t control interest rates or housing supply, but you can influence how buyers experience the process.

Helping people feel informed, calm and respected pays dividends for your reputation – and makes auctions sustainable in the long run.

Beyond the hammer

Auctions will always have an element of theatre.

The adrenaline, the gavel, the competition – it’s what makes them exciting.

But excitement without guidance can tip into regret, and that’s not good for anyone.

Buyers might be scared of missing out, but they shouldn’t feel tricked into overspending.

As an agent, you’ve got the power to balance the drama with the data.

Do that well, and you’ll earn loyalty long after the hammer falls.