By Rich Harvey, CEO & Founder, propertybuyer.com.au
For decades, the New South Wales Central Coast region was in a property market holding pattern. It was flying under the radar of homebuyers and investors alike. But COVID’s significant upheaval brought the region into the limelight. Now, a raft of drivers across the political and economic spectrum will deliver exciting times to the Central Coast – and those who own property will be among the biggest beneficiaries.
Anthony Knight, Principal buyers’ advocate for Propertybuyer on the Central Coast, has lived in the region for decades. We recently chatted about the region and why he’s excited about what’s to come.
A real estate agent’s focus is pretty simple when you boil it down.
Yes, there are complicated rules and regulations to operate within, and the fast pace with which property markets can move means they’re sometimes flying by the seat of their pants. But their ultimate goal is clear – to get as much money for their vendors as possible.
To achieve this, they’ll pull out all the stops. For everyday buyers, it’s hard to read them and get a clear and complete picture of what’s happening. Are there really other buyers waiting to pip you at the post? Is that guide price truly reflective of the seller’s hopes and the market’s position? Is the home in question really a solid investment?
Understanding what questions to ask and being able to get a true understanding of the answers is tricky at the best of times.
Buyer’s agents work solely for their clients. There are no ulterior motives, no potential conflicts, and no mind games. Our job is to secure you a property that meets your needs and wants for the best price possible, and with minimal fuss.
We are on the ground every single day, so we know intimately how markets work, what dynamics are at play now, and what the future growth trajectory looks like. And we know how to interact with selling agents to maximize the outcome for our buyers.
It’s no small feat. These are just some of the challenges we navigate for our clients when dealing with agents.
The illusion of competition
If a would-be buyer is hesitant or noticeably unhappy about some aspect of a property, be it inclusions, main features, contract terms or price, it’s amazing how often another interested party can emerge.
“There’s another buyer coming through for their second look today and they’re prepared to make an offer,” you might hear.
This creates a sense of urgency and a real fear of missing out. It might make a buyer more likely to accept a dealbreaker or offer more money. Or both. But is it true?
Sometimes yes, but sometimes the truth is being bent a little. There could be another buyer inspecting, but the agent may exaggerate their enthusiasm a little to try and create the illusion of competition.
A good buyer’s agent will know how the local market is performing in real time and will get a sense quickly about whether there really is competition. They’ll also know an agent’s track record and be aware of whether this approach is something that’s used before.
What’s the true price?
Underquoting has been a growing problem across much of Australia over the past few years. In a nutshell, some real estate agents purposefully issue a price guide that’s below market value – and sometimes even the vendor’s ambition – to lure would-be buyers in and create artificial competition.
Someone who likes the property might see hordes of others and up their offer, or bid more at auction, out of a fear of missing out.
It’s a practice that can really irk buyers, who fork out good money for building and pest inspection reports, strata committee assessments, and contract legal reviews, only to find they could never afford the home to begin with.
Buyer’s agents encounter underquoting regularly. Thanks to their strong knowledge about markets - including localised pockets within big cities and their unique price drivers - they can detect fairly quickly if a realtor is being a bit too creative with their guides.
They also know agents well and pick up on their track record. Let’s say a realtor’s listings of late have sold for 20 to 30 per cent more than guide, that’s something a buyer’s agent will observe and factor in when working with that person.
And buyer’s agents are in the market day in, day out. They’ll know about all the recent comparable sales, as well as current buyer demand trends and supply levels.
When an agent offers a guide, a good buyer’s agent will quickly be able to determine whether it’s on the mark or an instance of potential underquoting. They won’t waste their client’s time or get their hopes up on a listing they might otherwise have pursued, only to miss out.
The real return
An investor who’s searching for a property can sometimes encounter wildly incorrect rental market appraisals. Sometimes it’s a deliberately bullish estimate - an agent wants to make the listing as attractive to a future landlord as possible - but often it’s accidental. The selling agent simply doesn’t know what a home could really rent for.
An agent who’s vague or seems uncertain can be hard to read. A buyer’s agent can not only spot a lack of confidence in a rental appraisal, but they also know the market intimately. They can get an accurate picture of what a property would realistically return.
How tight is the market?
When property markets are tight from a supply perspective, you get a scenario where a large pool of selling agents are fighting to secure every single listing possible.
Without homes to sell, there’s no commission for them. They will do everything they can to win business, and sometimes this means they’ve gambled big in hopes they have a winning hand. They might assure sellers they can deliver a certain result, which is pressure they’ll redirect to any would-be buyers.
A buyer’s agent knows where supply is at in each market. They will get a sense of how competitive things are for selling agents and what kind of pressure they might be under. As a result, they’ll know to be more on guard for the tricks that can sometimes be used.
Fostering strong connections
One of the best assets a good buyer’s agent possesses is their network of contacts and connections throughout the real estate industry.
They spend years building and maintaining strong relationships in order to better serve their clients, who can benefit greatly from who a buyer’s agent knows and how they work those contacts.
This is why a buyer’s agent is your best access to off-market and pre-market properties. Oftentimes, a vendor who doesn’t want the fuss, delay or attention of listing a home and pursuing a traditional sale will turn a selling agent to get them a deal off-market. By having good contacts, buyer’s agent can take advantage of this network on behalf of their client.
But more than this, those strong and long-term relationships are usually built on a foundation of mutual professional respect and trust. When you trust and respect someone, you’re less likely to want to play games or be coy. Everyone is up front and honest about what they want and need, and the best way to make it work.
It simply makes sense to use a buyers’ agent. They are the specialist counterpart to selling agents, and can represent your interests in a professional manner, drawing on a wealth of experience and knowledge. Without them, you can be left at a distinct disadvantage, and wondering is a selling agent is saying what you think they are.
If you’d like help finding your next property, or working out where to buy, negotiating with agents, researching and navigating the changing property market ….then please reach out. Call Propertybuyer today on 1300 655 615 or email info@propertybuyer.com.au or use this link to send your enquiry today.
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