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Where to Find Cash Flow and Capital Growth May, 2012
The smart money is heading west February, 2013
Sydney's West to Lead Boom Next Year February, 2013
There’s nothing like having a bit of experience in your corner. A well versed professional capable of batting away the time wasters and spotting the hot purchase so you can leap on a deal before anyone even realises a sale was there for the taking.
Having a great buyers' agent (BA) on your side instils confidence that you’ll be financially safe. They’re your net below the trapeze and your industry insider mining the good oil on sweet deals.
As a buyers' agent with decades of experience, there’s been countless times when my market know how has not only set clients on a path to independent wealth, it’s kept them from making costly mistakes.
Sorting the BA gold from the coal does take some effort, however. So, here are nine questions to ensure your BA backed deal is more rock n roll than polka.
1. Are you experienced?
Qualifying as a BA takes effort but acquiring the qualifications and licences isn’t beyond the vast majority of the population… and that is a little frightening.
It doesn’t take long to build a list of those professing knowledge on how the real estate game works with the confidence of a Connor McGregor stepping into the boxing ring – and unfortunately the outcome is sometimes the same.
Just buying a Sydney investment in 2010 doesn’t qualify someone as a guru atop bricks-and-mortar mountain.
So ask them, “How long have you worked as a buyer’s agent and what experience do you have in my particular property type?”
2. Who have you bought for?
In the BA game, great client referrals are the gold standard. Happy clients mean more business to a talented BA. Reputations are hard won and easily lost, so terrific BAs make sure their service is top notch. Some BA’s only work in one market segment or on property type. Single operators are sometimes unable to offer the depth of service required.
I have full team of buyers' agents covering specific territories and we have substantial experience in Residential, Commercial and Development properties.
Ask the BA to supply references / testimonials of clients who are happy with their experience. Review the comments about what the BA did and whether their service was “value for money”.
3. What are your professional affiliations?
Here’s where I declare my position as President of the Real Estate Buyers Agents Association of Australia (REBAA) – the body governing members within our profession. Affiliation with a group like REEBA gives you confidence that the BA is held to a code of conduct and a standard of operation that promotes professionalism within our industry – or otherwise, they’re answerable to me and the board!
Other affiliate groups that require member to maintain skills through memberships and affiliations and/or continued professional development (CPD) schemes are the Australia Property Institute (usually associated with valuers), your state’s Real Estate Institute (agents) and Property Investment Professionals of Australia (investment advice).
Ask your potential buyers' agent who they belong to and what that means for their practice.
4. Are you licenced to practice?
This may seem straight forward but the waters get murky when you look at cross-border purchasing.
Different states and territories have different licencing arrangement for professionals operating within their boundaries. As property investment has become more “borderless”, less rigorous BAs have been looking to expand their skills interstate, but this is a big no no unless they’ve gained the appropriate licences.
5. How/what do you charge for your services?
You’re the BA’s client and your interests must be paramount.
Less scrupulous individuals wear the badge of a BA to convince their clients they have their best interests at heart – meanwhile they’re collecting commissions from a developer to put you into their stock. These marketeers are bad for our industry.
Ask flat out – “How do you earn your fees?” and get a straight answer.
Also, you may choose to work with a BA to who you pay a commission on purchase or one that charges at an hourly rate or even one who operates on a flat fee. All are viable but understand how they earn their dough before you go.
6. What is your process?
A great BA will clearly explain how the process will work.
Will there be consultations where the professional identifies your wants and needs in a property, your future plans in real estate ownership and even your financial situation?
Great BAs look at this info so they can proceed effectively.
If the only question a BA asks if, “How much have you got to spend?” then run very fast and very far.
Your BA should also give regular updates on your property hunt – when they’ve found a property, how much you should pay and at what point you should say ‘yes’ or ‘no’.
7. What services do you provide?
BA services can range from general advice through to a full assess, locate, negotiate and settle package. Under the full service model, a BA will not only help you get that property under contract, they may also co-ordinate pest and building inspections, liaise with financiers and agents and co-ordinate with your legal team.
Discuss early exactly what you’ll receive for the fee.
8. Show me your networks
Connections are key in real estate deals, so you want a BA who’s on the local agent’s speed dial.
Smart agents stay on good terms with quality BAs because they like dealing with a well-informed professional.
The payoff for you is off-market and early list opportunities that keep you ahead of the competition.
9. How do we say goodbye?
There are usually two conclusions to a BA appointment.
The first is where they find your dream home and make it yours with a minimum of fuss. It’ll be hugs all around and a bottle of bubbly come settlement day.
The other is where the client and BA don’t reach consensus on a property. Clients will sometimes lock in a BA for months, turning down multiple properties that seem to fit the brief, only to then decide to walk away from the arrangement. Before potential trouble strikes, discuss what happens if there’s a ‘no result’ result.
Using a buyers' agent means you have a highly qualified professional on your team whose sole role is to ensure you get the best possible deal, but finding Mr or Mrs Right requires a little effort. Use this guide to ensure in the real estate cage fight, your enforcer can hold their own. October, 2017