Do you want to avoid a house-hunting disaster that could cost you tens of thousands of dollars, months of precious time, or even worse – missing out on that perfect property?
Perhaps you’ve decided that hiring a buyer’s agent will get you the best result to find your dream home or ideal investment.
Your decision is likely not just about saving time and money, but also about having a professional in your corner and a voice of reason in your ear when you know you’ll need it.
The thing is, not all buyer’s agents are equal, and those with a great track record aren’t necessarily suited to your needs.
Hiring a buyer’s agent is a significant investment. Understanding how to prepare for the buying process and how to choose the right agent for your search will save you in every respect. Avoid the following mistakes and you’re well on the way to a profitable, and enjoyable buyer’s agent experience.
Mistake #1. Hiring an agent before your finance is approved.
Serious property hunting without the funds available is unproductive. You cant buy if you haven’t got the money! The first step of buyer preparation is to have your finance in place- preferably a fully assessed loan rather than just an approval in principle.
It’s certainly advisable to research your property market, write your brief, and get your buying team in place whilst arranging finance. However, the right time to put your buyer’s agent to work officially is when your finance is approved.
Mistake #2. Choosing a buyer’s agent without a buying team if you don’t have one of your own.
A successful buying assault on a sought after home or investment requires a crack team of experts; In addition to your buyer’s agent you’ll need a top broker and solicitor, and if the property is a renovation project, a builder, perhaps an engineer and quantity surveyor as well. This group comprises your personal army, your buying team.
If you don’t have a team at hand make it a high priority to select a buyers agent who can bring one to the table. Hiring this agent means you’ll inherit their panel of experts who have worked together in the past. You’ll enjoy the advantage of ‘synergy’ when an experienced team works together with your buyer’s agent for a great result -all without you having to lift a finger.
Mistake #3 Not choosing a buyer’s agent who is completely independent and working for you
A buyer’s agent is being paid by you to work 100% in your best interest.
This means they should not accept any type of incentive or remuneration from anyone but you. A clear contravention of this principle would be a buyer’s agent accepting commission from a developer for an introduction that leads to a sale. Less clear might be a referral fee accepted from a mortgage broker or even a furniture removal or pest control company they’ve recommended to you.
Standard agency agreements in all states generally make provision for an agent to disclose referral fees and commissions however for the utmost peace of mind you should insist on an agent that accepts nothing from anyone but you.
Mistake #4 Not choosing the buyer’s agent service that corresponds to your needs.
Good buyers agents generally have three or four core offerings ranging from “full service” to appraisal, negotiation, and auction attendance. Choosing the appropriate service will require you to be realistic about your own property skillset and the time you can allocate to your house hunting.
If you have the network, resources, and experience to access suitable properties then an ‘appraise and negotiate’ or ‘bid at auction’ service may really be all you need.
Be aware that although you think you can do the job using just these services, you can’t buy what you can’t see and this approach may cost you more time and money in the long run.
Mistake #5 Not choosing a buyer’s agent who specializes in your desired area.
An agent that works (and lives and plays) in the suburbs you are searching within is tuned into the important details that can affect a successful purchase. A formal appraisal or valuation is no comparison to the local knowledge of a seasoned area specialist. Bad neighbours, upcoming poor development, problematic executive committees..a local specialist will be aware and steer you clear of troublesome issues that are not apparent to an outsider.
Mistake #6 Not paying the right price for the service you’re getting.
Buyer’s agents’ pricing can vary widely, and with good reason. Any good agent will tailor the scope of works to your circumstance and most will agree on a fixed price that reflects the work involved. It is worthwhile to understand what that work entails.
A detailed, particular brief for a property in a tightly held suburb should command a premium and what you’ll be paying for is the buyer’s agent’s network of local selling agents, business people, and community, as well as their less conventional methods of sourcing property.
More abundantly available property in a less salubrious suburb will see you paying a buyer more for their time conducting inspections and putting together the deal, or their analytical skills if it is an investment property.
Paying an entry-level agent an entry-level fee for a challenging brief will not give you an expert outcome.
Be as wary of ‘cheap’ fees as exorbitant fees. Take a moment to consider the difficulty of the task at hand and the time and expertise required.
Mistake #7 Not assessing the methods your buyer’s agent will use to find your ideal property.
Good buyer’s agents will apply multiple resources to source property and it merits asking how your buyer’s agent operates. Key activities you should listen for include personal outreach to a selling agent network, extensive use of research tools such as RPData, and personal outreach to potential sellers, amongst others. Opportunities arise from contact with people and the best agents spend all day talking and researching.
Mistake #8 Not choosing an agent with auction experience if that’s the likely method of sale for your property.
If the common method of sale for your future home or investment is via auction then your buyer’s agent should have extensive bidding experience.
Auctions are volatile environments where the odds are stacked against the seller. There is plenty of room for error leading up to, and on the day and you will need an agent that, is calm, knows all the rules, and has multiple battle-tested bidding strategies. A well-chosen agent will often know the auctioneer and their calling style which can help.
It’s not considered rude to ask your prospective buyer’s agent about their auction experience, and their preferred bidding strategies.
Mistake #9 Not screening your agent for negotiating power.
Buyer’s agents are negotiators. They are the conduit between you and all the other players in a high stakes situation. They’ll likely even mediate between you and your spouse when the pressure is on at deal time! To screen for a good negotiator you’ll need to trust your instincts rather than ask questions. Your prospective hire should leave you with the sense that things are going to go your way. Chances are they’ll be waving that magic wand over the other parties too which makes a good deal more likely.
Mistake #10 Not having a well-defined brief for your agent.
The more thoroughly you detail and communicate your wants and needs, the better your outcome. A good brief goes way beyond just the property attributes. If the property is to be an investment share your overall long term goals, how the purchase will fit into your portfolio, and when and how it will be divested. If it’s your family home share what you do for work sport and hobby, what your evenings and weekends look like, where your kids spend their time. Property choice is driven by lifestyle and understanding this is key for your agent to find that perfect property match.
Mistake #11 Not confirming your buyer’s agent will be working exclusively on your brief.
A buyer’s agent cannot work in your best interest if they have signed on other clients looking for the same type of home in the same suburb and similar price range.
You need to ask the question- will your brief, price range and instruction have exclusivity in your agents’ portfolio, until they have found your property? It’s not a rude question to ask a prospective buyers agent what other types of clients they will concurrently be working on and what assurances they can give you there will be no conflict of interest.
It’s easy for buyer’s agencies large and small to blur the line by having multiple clients with similar briefs. In a tight market with short supply who gets first dibs on something matching multiple briefs?
Mistake #12 Choosing a larger agency aned being assigned a junior or an associate.
As with many professional services sectors you run into the possibility of being pitched to by a senior expert only to have your brief delegated to a junior once you are on board.
This can be a frustrating experience. If you are choosing a larger organisation always confirm that the agent you want to be looking after you actually will personally be responsible for your search.
So there it is in a nutshell. Using a buyer’s agent will be a profitable and enjoyable experience so long as you can avoid the above mistakes.
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