Why Buyers' Agents Are Better At Making Offers - September 2020
There’s a perception that the impact of coronavirus has tipped the property market firmly in the favour of buyers.
Some look at the broader economic shocks occurring and assume something similar must be taking place in real estate, and that purchasing now should be a breezy and uncomplicated affair, with unbelievable bargains to be squeezed with minimal effort.
But what I’m seeing on the ground, coupled with all of the latest market data, indicates that the exact opposite is true.
Competition is tight. Auction clearance rates are strong. Sellers aren’t budging if they don’t have to.
It makes the entire negotiation process a tricky one for those buyers going it alone. But there’s a secret weapon they can add to their arsenal to blow the competition out of the water.
Buyers’ agents are better at doing deals – there’s no doubt about it.
This is always true but particularly relevant when markets are tight and there are considerably more buyers than properties for sale. Why? Because getting to the front of the cue on a hot prospect becomes near impossible.
New listings are quickly snapped up and price guides seem to hold no relevance, with sales above and beyond what even the most conservative agent might’ve anticipated for their clients.
The ability of buyers’ agents to negotiate better than anyone else is especially true when markets are patchy.
And markets are certainly that at the moment.
Prices aren’t booming, it’s true, but they’ve also defied every expectation of a crash over the past several months of this COVID-19 reality. Any reductions have been modest at best and some suburbs are performing strongly, especially tightly held blue chip areas.
The number of listings has plummeted. If vendors don’t need to sell right now, they’re sitting on their hands.
At the same time, the level of activity among prospective purchasers on the ground is stronger than anticipated. Go to an open home in a decent Sydney suburb any given Saturday and you’ll find a dozen or more groups going through. Although auction events are limited, they’re still seeing good numbers of registered bidders and clearance rates in the Harbour City are routinely in the high 60 per cent range.
So, while prices aren’t skyrocketing like they have during highly active periods, this current landscape is akin to a boom time. That is, there are more buyers than sellers.
In this circumstance, would-be buyers need every advantage they can get.
Enter the buyers’ agent.
When it’s difficult to get an accurate measure on a property’s current worth, as it can be at the moment, a buyers’ agent is able to assess a dwelling’s realistic value to ensure you don’t pay too much or, sometimes, offer too little.
They know individual suburbs inside out. They know what makes them tick. They know the type of property that will appeal to buyers, from its orientation on a site to its features and layout. They know what changes are occurring in the area that impact demographics, liveability and growth.
While the month-to-month data and immediate real estate activity might be hard to follow, a buyers’ agent is connected to the fabric of a local market in ways that a buyer on their own can’t be.
And they operate without emotion.
Even the most astute of buyers can’t help but be drawn to the emotional value of a potential home. From the moment they feel that pull of the heartstrings, that whisper in the head that ‘this is the place’, they imagine themselves living there and picture their kids playing in the backyard. They scope out their new local coffee shop or restaurant. They mentally plot the commute to work.
Buyers’ agents remove the trap that can so easily snare anyone – overpaying and potentially living to regret it.
On top of that, they’re masters at reading the room. They can get a sense of what scenario might be driving the sale and the vendor’s needs and wants. This is hugely powerful in the negotiation process.
Buyers’ agents can read between the lines to pick up on the things that are left unspoken. Is the seller in a hurry? Have they moved on from the property, either mentally or actually? Are there certain conditions or perks that can push a negotiation over the line?
Buyers' agents are masters at contract conditions beyond price. Will a longer or shorter settlement land you the property? Can a larger deposit be the tipping point? We know the right buttons to push to ensure our clients secure the deal.
They can anticipate the conversations that are likely to be had between a sales agent and their client after an approach is made on behalf of the buyer. This helps guide the timing of the offer, how high or low it should be and what increments might follow.
Best of all, they know instinctively when it stick it out and when to walk away.
And buyers’ agents almost speak a different language that even those who’ve bought many times aren’t fluent in.
There’s a unique dialogue between buyers’ agents and sales agents. While they work for opposing sides, they’re in the same game and walk the same streets. They’ve handled hundreds, sometimes thousands of deals.
Put simply, property is in their blood.
And so, the nuances of communication are very precise. It’s a totally different scenario to a lone buyer and a sales agent. It also offers the opportunity for some frank discussions.
There are fewer games. The vendor’s representative knows that a buyers’ agent is on a level playing field with them. The buyers’ agent knows all of the tricks of the trade. A particularly experienced one will have seen it all in their time.
At the end of the day, this isn’t a buyers’ market – much as some might assume it is.
A buyer needs to approach a potential deal from a position of strength and prepare for a negotiation to be just as tough as it would be in a market boom.
That requires skill, experience, inside knowledge, an understanding of the many moving parts of the dynamic, a flawless ability to go head-to-head with a sales agent and the cold resolve to make decisions that are in the best interest and not driven by emotion.
A buyers’ agent offers all of that.
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