By Rich Harvey, CEO & Founder, propertybuyer.com.au
Off market listings can be either diamond buys or lumps of coal, but to sort the good from the bad you need access to them in the first place.
This is especially true in blue-chip locations like the Inner West of Sydney where quality listings garner plenty of interest. As such, good off-market prospects are snapped up before the public gets a look in.
So, why do sellers choose to go off market in these locations and how can you be part of the inner circle who find out about them?
To help answer these questions, I’ve roped in Propertybuyer’s Inner West expert, Nick Taylor-Fick. Nick had some great insights plus a couple of off-market antidotes to share.
Why vendors sell off market
It’s said you can’t sell a secret, but that’s not entirely true when it comes to off-market homes. It just depends on the seller’s motivations for offloading the property without openly advertising their intentions.
Owners who sell off market do so for various reasons.
Often, it’s about privacy. Off-market sellers want to deal with genuine buyers and don’t like the idea of “sightseers” trapsing through their property during open homes.
And while agents may love an auction campaign, not every owner is thrilled with the stresses they bring.
Then there are sellers who want a quick, no-nonsense sale for a variety of reasons. Perhaps they’re suddenly moving interstate for a new job? Maybe the property disposal is part of a marriage separation? They could be looking to raise funds quickly to cover a debt.
No matter what the reason, these sellers want to deal directly with buyers that are qualified and ready to act without the need of a full marketing program.
How to secure off-market
Gaining access to off-market deals is a challenge for the everyday buyer. Most of them will only know about a potential purchase once it appears on a listing portal.
So how do buyers’ advocates unearth them?
As Nick explains, the crux of the off-market marketplace is relationships.
There is no doubt that buyers’ advocates hear about quite listings because they’ve taken the time over many years to build trust and solid lines of communication with local agents.
He also places high value on making more personalised contact with the agents. Nick said you can try and establish connections via email, but it’s far better to reach out by phone or in person.
When Nick meets a new client, he pulls together a buying brief and immediately contacts the local selling agents that are most likely dealing with these types of homes.
This approach yields excellent results because of the rapport he’s built up over time and through multiple transactions with those local agents. The agents Nick deals with know he can make quick “Yes/No” decisions about a listing’s suitability for his buyer. The local agents are also aware Nick won’t waste their time during negotiations and will only bring serious buyers to the table.
Maintaining strong networks is an ongoing exercise too. While he may not have a particular brief to pitch, Nick still regularly reaches out to agents. He also engages with them at social and professional gatherings too ensure he’s top of mind when an interesting off-market listing comes along.
There are other networks that can be drawn on as well to identify off-market prospects, such as Propertybuyer’s database of past clients. An established business like ours has built up an enviable database of property owners over the years. We can put the call out directly to those owners and see if they, or their neighbours, are thinking about selling.
Other professional networks can prove fruitful as well. Accountants, lawyers, town planners, building inspectors… the list goes on. All these contacts can have the inside running on a pending listing. Many even approach us directly on behalf of their clients before they go to an agent.
Then there are social networking opportunities. From kids’ sport on the weekend to golf and tennis club memberships or any other group activities. Meeting people at the dog park around Hen and Chicken Bay, chatting to people in the café line in Balmain, Five Dock or Leichhardt, or picnicking at Putney Park provide ample opportunities to meet new people. Nick said there’s always a chance to talk about what we do as buyers’ advocates, so people know we are on hand if they want to sell their property directly.
There are other ways to seek off-market listings too. Some might suggest direct approaches via area-wide letterbox drops or even door knocking certain homes. While this is a tactic Nick has employed in the past, the volume of opportunities is very low.
Off-market for all
Nick said many stakeholders believe off-market opportunities are only for prestige property or during certain market cycles, but that’s incorrect. Off-market can appeal across many sectors and at any time.
For example, Nick recently had a young couple of first homebuyers seeking a home around Hornsby and Mount Colah. They were considering a three-bedroom apartment simply because of their limited budget.
But Nick knew the pair were handy with the tools and could tackle some renovation work, so he started broadening his search criteria.
He was chatting with one of his agent contacts in Hornsby who told him about a renovateable cottage that was about to come onto the market. It needed work but was in a great location and a quiet position. The owner was an elder gentleman who was moving to assisted living and his family were eager for a no-nonsense sale.
The couple paid $1.08 million for the home which proved a savvy purchase after another house sold two doors down for $1.2 million soon after.
At the other end of the price scale were the high value clients looking for an investment around the Balmain peninsula that they could downsize into in a few years. They wanted to be close to the water and had a budget of around $7 million. One of Nick’s best contacts came forward with a off-market listing of a three-level duplex with incredible water views priced at $5.7 million. The sellers were very private and simply didn’t want to go through the process of staging and marketing the home. Nick secured the property before anyone else got a look in – including some eager and ultimately disappointed competition from overseas.
Buying off-market is possible but unearthing the options takes an extraordinary amount of effort and requires an extensive agent network to draw on. As such, the ultimate source for these silent deals is a buyers’ agent. You can leverage off their firmly established connections to help you land a property before the public even knows it’s for sale
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