If you’re looking to buy a home, the idea of having someone who’ll look after your interests 100% is an attractive one. Enter what’s known as a buyers agent or advocate! Buyers agents are very common across Australia now. They work on behalf of buyers by searching for properties, evaluating them and then negotiating with sellers (or their agents) while also sealing deals at rates that keep both parties happy.
By now you may be thinking of hiring a buyer’s agent to help with your next property purchase, but are they worth it? Depending on who you choose, a buyer’s agent service can be quite costly: at an average 2% off the total sale amount plus GST (roughly $14,000). So is it really worth allocating funds towards another player who wants money from such a booming market sector or should we just bite our fingers over missing opportunities ourselves instead?
The main benefits of using a buyers agent
Negotiation and market research
A buyer’s agent has the potential to save you money, but it is impossible to predict whether or not they will. The price of a home varies depending on how flexible your prospective property’s vendor may be; for instance, if that individual needs cash quickly and doesn’t have time for an extensive sales campaign in order “to ramp up interest.”
Property sales are not immune to the effect of supply and demand. Sometimes it’s more of a seller’s market and you just have to go out and buy property regardless of how unfavorable the conditions are. In some cases, there may be no competitive bid on properties for sale. So buyers have to simply take the initiative of buying knowing they might miss their chance at owning the property if they don’t. A good buyers agent in Melbourne will have done the market research to tell you when is a good time to buy and when it’s better to hold back and wait for a better option to come along.
There are times when a buyer’s agent can help you get the best price for your property. When negotiating, an experienced and well-informed buyer’s agent with access to reliable market data should be able to question or challenge what most sellers think their home is worth based on how much they’re willing to negotiate—whether this means moving too high in negotiations or not dropping as low as other buyers might offer. In any case, buying through an experienced buyer’s agent will likely save you money down the road by getting more of what it really costs out of your sale now than if you negotiated alone.
Finding off-market properties
For buyers who are trying to avoid the competitive bidding that goes on at auction, off-market properties can be a good alternative. There’s usually a very good reason for a vendor to sell a property off-market. The vendor may be forced into selling their property fast because they simply don’t have enough time for a full marketing campaign to generate interest. They need the property sold quickly but are still interested in generous bids.
It’s understandable that the prospect of an off-market property would be tempting to a potential first-time buyer. After all, with so many properties on offer online, who doesn’t want some undiscovered gem? However, buyers should not rely too heavily on their agents for these types of listings because they are rare and mostly just as disappointing as those found in more traditional searches.
Bidding assistance and saving you time on property searches
If you’re on a tight budget, or if you don’t mind spending your time house hunting, then using an agent may not be worth it. But for those who are relocating to another state and want the security of knowing they have someone in their corner with experience finding them homes before hitting the ground running? An agent is invaluable!
The choice between hiring a buyer’s representative can boil down to personal preference: Do you like saving money by doing all of that work yourself? Or would rather enjoy having some help out there getting houses up until your relocation date so that when everything comes together at once after coming into town (or even long-distance) — well, let’s just say this one thing will make life easier than ever.
There are many reasons why some people might need a buyer’s agent to bid on their behalf. The starting fee for an auctioneer is about $500 and there may be other fees applied should they win the property but it is worth noting that this can help make you feel more comfortable. So if you’re not experienced, then hiring one could save you money in the long run.
Auctions typically end up being competitive environments where your highest bidder will stand victorious even with any strategies employed by agents like scaring off competition or helping buyers get better prices. Securing a property at auction can be tough enough without having to worry about bidding strategy too. There are plenty of professionals who specialize in these matters though.
So is a buyer’s agent really worth it?
There is no doubt that most property buyers stand to benefit from having a professional guide them through house-buying processes like bidding at an auction. With local property markets that have fewer house listings than new estates, it can be very hard to find that competitive edge amongst other house buyers with deeper pockets.
At the end of the day, a buyers agent in Melbourne can help you narrow down your property search to find a property with less competition. When it comes to the bidding process your buyers agent can put their negotiating skills to good use in order to help you secure a great property. Just remember to think about the fees associated with hiring a buyers agent. Establish service fees from the very beginning so you have a clear understanding of how much the service will cost.