By Rich Harvey, CEO & Founder, propertybuyer.com.au
Imagine if you signed up for personal training so you could shed some kilos, organised a meal plan to eat right and get in shape… and then saw your PT moonlighting at the local fast food joint.
It’d feel a bit like the person meant to be getting you healthy was playing both sides of the fence – dishing out the bad stuff and then lecturing people about how to turn themselves around.
Something similar happens in the property space. It’s when those who act as sales agents also try and position themselves as devoted advocates for buyers – either professionally seeking properties for clients or during negotiations on a listing they have.
How can a buyer expect to get the best guidance from a party who has a vested interest in selling property as well? Independent property investment advice needs a separation of these two functions.
A buyer’s agent is an essential part of your investment decision-making. But how can you be sure you’re enlisting a good buyers’ agent that acts exclusively for buyers?
What’s the difference?
A little basic knowledge on buying and selling professionals is a good place to start.
A sales agent can come across as your most trusted confidant when marketing a property. But make no mistake – they aren’t working in your best interests. A selling agent acts for the vendor. End of story.
I applaud sales agents who make an honest living working hard for their client, but buyers need to be aware of the relationship, as it can end up costing them thousands more.
Sales agents may put forward a convincing argument about how they’re trying to get the deal done for you as the buyer. They might talk about trying to get their vendor to ‘meet you in the middle’, or about the strength of the local market or the quality of the place you’re looking at and how ‘these opportunities are rare’, but you should always take it with a grain of salt.
At the end of the day, without exception, a sales agent wants to get the vendor a signed contract. You’re the person with the cash and an interest in their property.
Want to know a bit more about how a Buyers' Agent works? Click here
A buyer’s agent is the exact opposite. A buyer’s agent works for you, the purchaser, without question. They know your goals, what you’ve set out to do, and will work around the clock to make it happen. They’ll steer you away from bad deals. They’ll give you inside information about a local market and where the best opportunities are. They’ll even find listings that aren’t yet public.
And they’ll negotiate directly with a sales agent so that you don’t have to deal with the rigmarole.
A buyer’s agent is your advocate. They represent you and your interests. But they’re also your personal researcher, presenting only the best potential deals to suit your strategy and your budget, as well as the future growth potential of your portfolio.
There’s an enormous difference between the two and when there’s a crossover, it can be concerning. Whether they’re steering you towards purchasing a property they’re marketing, or offering to find you a holding that fits the bill among their listings, it’s hard to trust an agent that’s playing both sides of the fence. Be careful of “dual agents” that work on both sides of the fence. By law an agent cannot act for both a buyer and seller in the same transaction.
Finding a great BA
Like every profession, not all buyer’s agents are created equally.
You want someone who is truly independent and not aligned with particular sales agents or developers. You want one who is properly qualified and expertly experienced. And you want a buyer’s agent who has a wealth of experience.
Word of mouth is a great place to start. Ask around your circle of friends, family and colleagues to find out who they’ve used and what their experience was like.
Also, check out the Real Estate Buyers Agents Association of Australia (REEBA). This body is all about maintaining the professional standards and education of independent buyer’s agents. REBAA members must abide by a strict code of conduct. Any professional worth their salt who is operating in this space should be a member. If they’re not, either ask them why or run for the hills.
Ensure the buyers’ agent you are planning to use is appropriately licenced in the state they operate. Also, request references from past clients, along with documented proof of their performance and results. What have they achieved for others?
Deal with the best
Check a buyer’s agent’s qualifications and standing within the industry. Be confident that they’re independent and truly working in your best interests. And make sure they’ve got plenty of runs on the board and a lot of experience under their belt.
When you find a good buyer’s agent, purchasing property is a dream, not a nightmare. They know your goals and will help you achieve them without the stress, fuss and nonsense that comes with going it alone. They find deals you wouldn’t and take the hassle out of securing excellent real estate.
Do your due diligence and avoid dual-purpose agents pushing their own agenda.
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