Should Home Buyers Use Buyers Agents?

BY CHRIS GRAY, CEO, YOUR EMPIRE

Many people use buyers’ agents when looking for investment properties, but do they work for home buying too?

Many home buyers know their suburb inside out. They’ve lived there for years, they know every property that’s been bought or sold, and they know of the asking price has gone up or down. Despite this, it can still take them months or years to be able to find the right property at the right price and often the market has jumped in that time. Either that or they settle for something that doesn’t really tick all the boxes that they wanted. Here’s some thoughts on why it may be good for you to use a Buyer’s Agent on a home purchase, even if you do know the market inside out:

they want in a property. Having a third party involved can bring that conversation together and be a sounding board as to what the ideal property looks like – it’s almost like relationship guidance even in a happy relationship!

1. When it comes to investment acquisitions, they are often very numbers driven and so it’s relatively easy for partners to be on the same page when it comes to deciding to purchase or not. However, homes are much more of an emotional decision and so partners often have differing views as to what

2. With any emotional purchase it’s good to have someone not connected to the sale to give you some reality on the market. You might love a certain type of property or part of a suburb but if it’s going to stunt the future growth of the property, you need to be aware of it before you decide. For instance, some people don’t care about parking as they have everything around them or they prefer to travel by bike or scooter. Not everyone thinks that way and future buyers or renters of that property maybe turned off it in the future. You might well be able to save some money off the purchase price as it’s got no parking, but if it only grows by 6-7% in the future, compared to others at 8-9%, you’re going to lose out over the long term.

3. Even though a home isn’t about financial return, for many it’s still your biggest asset and the largest part of your wealth on retirement and so it still makes sense to have the accountant’s hat on as part of the process. I often recommend still getting an independent valuation done prior to purchase to see what it’s worth from a worst-case scenario. There’s no problem paying over that valuation if that property gives you what you’ve really dreamed for, but at least you know the difference between financial and emotional money.

4. In this current market, most people believe the market has dropped and they’re after a bargain. This can be true in many locations and there are bargains to be had. However, good properties in good locations still sell well, especially if they are near schools, transport and leisure facilities. There’s lots of competition for them and there’s always someone willing to pay the price if it ticks all the boxes and is in the median price of the suburb. So even buying in a downturn can be very hard with not much stock around and plenty of buyers chasing it when it comes up.

5. If you’ve got very unique taste or very special requirements, then it’s not just about identifying the property, you actually need to make sure you can secure it when you do find it. You need to be able to make a very quick decision and you need to have all you ducks lined up so you can press the 'Go' button i.e. finance, solicitor, inspectors etc. It’s often the buyer’s agents long standing relationship with the agent that can make the difference of securing it or not. Agents can often transact with a buyer’s agent at a lesser price than the public have offered as they know it’s a guaranteed deal versus that of a potential tyre kicker.

6. Everyone sees all the properties that are on Domain.com.au and Realestate.com.au but what about all the other properties that sell without hitting those websites or what if you could get access to them a week before they go online? Just like in any industry, those that are inside the industry get to see deals before the general public do. That can make the difference between being the only bidder on a property you really want, versus have 3-4 other buyers with bigger budgets than yours to compete with a plane to see what’s happening. Coming back home for Christmas? Do you really think that perfect property will be on the market just at the point that you return, in possibly the quietest time when most agents head off overseas for December and January? a property that didn’t even hit the market, other times it’s about securing a property at any price when you do find it because your needs are very specific and other times it’s about just getting it at the best possible price.

7. If you live interstate or overseas people, then the above gets even harder. If it’s tough enough for those that live around the corner, how easily can you see what’s happening if you need to jump on

Whether you’re looking for an investment property or a dream home to bring up your family, buyers’ agents aren’t for everyone. If you’ve got a philosophy of looking after the pennies and the pounds look after themselves then it’s probably not for you. If you know everything about the market, then it’s probably not for you either. But if you know that no matter how much knowledge you have or no matter how many agents you know, it’s very hard to compete with an independent third party who works with the agent’s day in day out. Sometimes it’s about finding

About the contributor

Chris Gray is CEO of Your Empire, a buyers’ agency that buys homes and investments for time-poor professionals – searching, negotiating, renovating and managing property on their behalf. Chris has spent over 10 years as the host of ‘Your Property Empire’ on Sky News Business channel, where he’s interviewed various heads of property research companies and major industry figures. Chris is a qualified accountant, buyers’ agent and mortgage broker. For more information, visit www.yourempire.com.au and follow Chris on Facebook: @ChrisGraySydney