This is the guide to getting the most out of your buyer’s agent in 2019.
In this new guide I’ll show you:
- How to work with a buyers agent
- What exactly buyers agents do
- Reviews of buyers agents across Brisbane’s property market
- Lots more
Let’s get started.
Chapter 1: What Is a Buyer’s Agent?
Let’s get one thing straight.
A buyers agent is on the buyer’s side.
Which is different from a real estate agent who is on the seller’s side.
Let’s take a look.
What is a buyer’s agent?
Tenille is looking at purchasing a home on the Gold Coast. Her buyer’s agent – Janine is keeping watch of new listings and has found one perfect for her.
In this case, the buyer’s agent will negotiate on behalf of Tenille.
The property will go to auction, and the agent will bid for her and ensure that all the correct steps are followed for her to get the best deal possible.
In other situations, buyers also hire an agent after they’ve found a home, to then do the negotiating.
A lot of buyers don’t understand what exactly a buyers agent is.
So to keep it simple, a buyer’s agent is a hired professional who works on behalf of the buyer.
Their job is to help find, research and negotiate the right property.
They represent the interests of their client, the buyer. They are very different from a real estate agent, whose interests are allied with the seller.
But how do you know if a buyer’s agent is reputable?
We’ll get to that in a minute.
Benefits of using buyer’s agents
It’s estimated that only around 2.5% of property sales are through buyer’s agents in Australia.
For the most part, it’s because of agents like Frank Valentic, a previous judge on Channel 9’s popular TV show, The Block.
In 2016 Frank was fined and suspended for six months after his company charged two customer $13,750 without providing services to justify the fee.
There are so many cowboys like this.
But don’t stress, because using these strategies will safeguard you against predators.
Do you need a buyer’s agent?
This is a great question.
A buyer’s agent isn’t for everyone, but here’s a list to know if one is right for you.
A buyer’s agent might be right for you if you’re:
- Need to buy quickly
- Don’t like to negotiate.
- If the property you’re looking to buy is unique or one of a kind
- An investor looking to make decisions based on data and numbers
- You’ve been looking for a long time.
- You’re buying in a location that you can’t get to quickly for inspections.
- You’re going to auction
And while there are many other reasons for having a buyer’s agent. The main thing is to understand is why you’re looking for their help?
Knowing this will enable you to get the most value out of their service.
Buyer’s agents vs. real estate agent: What’s the difference?
The main difference is that a real estate agent is working for the seller.
Not the buyer.
Their focus is to market the property for sale, build interest among the buyers, and get the highest selling price from the buyer.
Real estate agents are paid a commission from the vendor/seller.
Why Hire a Buyer’s Agent?
A buyer’s agent can be a huge help when applying for specific types of properties. This includes off-market properties and distressed sales.
Buying a property that isn’t listed on the market could save you a lot of money.
The sellers won’t have to pay a real estate agent or advertising fees.
Side note – an off-market property is a property that’s currently not for sale. It is typically sold directly from seller to buyer without the intervention of a real estate agent.
A friend of mine was looking to buy their dream home, had been looking for over two years to no avail. What they were after was specific, they never seemed to find properties which met their criteria in the few suburbs they wanted to live in.
So instead of going in alone, they decided to seek the guidance of a buyer’s agent who specialises in buying properties off the market. Within eight weeks the deal was closed and settled. They were over the moon because it was a great price, found a home that met their specific needs and all the hard work was done for them!
For a buyer’s agent to find a property off-market, typically this hard work.
To uncover these types of homes requires local knowledge, door knocking, letterbox drops, and engaging in the local community.
So to see if your buyer’s agent is able to help with this ask the following questions:
- What strategies have you used in the past to obtain off the market properties
- What would your game plan be for my property?
- Can you show me your track record in buying off-market properties?
Distressed sales are as rare as hen’s teeth. These types of transactions are where a great buyers agent will shine.
A distressed sale can be defined as a property which is sold in an urgent manner.
The seller typically sells at a loss due to time constraints. These constraints vary from repossession to divorce.
Because of the general nature, it’s not uncommon for these types of properties to need a bit of a freshen up (generally new carpet and a fresh lick of paint).
When I was working for a bank years ago, I had a client who bought a distressed property.
The sellers were going through a divorce. The owners had been told either they needed to sell, or their lender would do it for them.
Because of this, my client got such a bargain that the bank’s valuation came in 13% higher than the price he purchased. This is considered significant and for this to happen is extraordinarily uncommon as the bank valuations are notoriously overly conservative.
To reap the benefits of a distress sale, a great buyers agent will have contacts in three key areas;
- Will / Estate
The buyer’s agent’s contacts may vary, but some include, solicitors, real estate agents, executors and bankers, to name a few.
So before choosing your buyers agent ask him/her the following questions;
- Do you specialise in Distressed Sales?
- What contacts do you have in this arena?
- Can you please show me recent case studies?
- What is your process in securing a deal for a Distressed Sale?
How much do buyer’s agents cost?
You’re probably wondering how these agents make money?
Well, a buyer’s agent is independent and shouldn’t receive a benefit. Not from the sale of the property, or any partners involved in the transaction. So that means no money from developers, real estate agents, mortgage brokers, solicitors and banks.
You pay the agent to provide advice and to represent your best interests.
So before choosing a buyer’s agent, it’s best to ask if they’ll receive any incentive outside of your payment.
Note: incentives may not always be monetary.
Some examples include holidays, education, marketing, staffing.
You will need to clarify moving forward if your agent receives an outside incentive or kickback. And whether they are obliged to disclose this to you.
How much is a buyer’s agent fee?
Understand that buyer’s agent have two ways they’ll charge for their services; either a fixed fee or a percentage of the purchase price.
Fixed fee charges range from $1,000 to $15,000, depending on how much of the process they help you with.
So if you only ask them to help with the negotiation, you can expect to be on the lower end of the scale.
The alternative ranges from 1 – 3% of the purchase price and in some ways is counterproductive to your relationship with a buyer’s agent.
Because the more you spend, the more they earn.
How to get the most out of your buyer’s agent?
Rather than paying a fixed fee or commission based on the purchase price; flip the script and negotiate based on the amount they save you.
For example, if the property you want to buy is listed on RealEstate.com.au for $700,000 and your buyer’s agent was able to secure it for $625,000.
You’d pay based on the difference between the two.
In this case, you’d pay a percentage of the $75,000 (which was saved).
Typically this ranges from 15% to 25% of the savings, depending on your price rate.
So in this case – the buyer’s agent would be paid between $11,250 to $18,750.
This, in itself, creates an incentive for the buyer’s agent to work in your best interest and get rewarded accordingly!
Chapter 2: Tips To Use When Choosing A Buyer’s Agent
In this chapter, I’m going to show you my favourite tips when it comes to finding a buyers agent.
Fortunately, a buyers agent is the best partner for you to deal with.
Unlike a real estate agent, they are on your side.
But in most cases, all you need to get started is a shortlist of agents that people have used to find one that is suitable for you.
How to hire the right buyer’s agent:
For you to get the best outcome from a buyers agent, there are a few things you can check.
- Check the buyer’s agent licenses. They should be a fully licensed real estate agent, with a minimum of two years experience as a buyer’s agent.
- Be able to show you a history of buying properties. Aim for a minimum of two purchases per month.
- Have great reviews on Google Reviews, their website and other websites. You can even ask to speak to their previous clients for an honest review.
Tips To Use When Choosing A Buyer’s Agent
The proof is in the pudding when it comes to choosing a great buyer’s agent.
Look at your agent’s results and see what they have sold.
That means looking at the sale price, the time on the market, and so on.
Where can I find a buyers agent?
Start by knowing what you want out of the agent. And where they’ll fit in your buying journey.
From there, be specific with your search. Your buyer’s agent should know what you want — the more detail you give them, the better.
Just like most industries across Australia, each state has its own set of requirements.
For example, in Queensland, a full real estate licence is needed.
However, in New South Wales, only a restricted buyer’s agent real estate licence is needed.
Ideally, your buyer’s agent will also be a member of industry bodies like Real Estate Buyers Agents Association of Australia, the Property
Investment Industry Association and Australian Property Institute. Which sets standards and code of conduct for members to adhere to and abide by.
Search for a buyer’s agent here.
Buyer’s Agent Checklist
So you’ve found a few buyer’s agents that look like they might be the right fit.
Now it’s time to ask them some questions to see if they align with what you’re looking for.
- How long have you worked in the industry as a buyer’s agent? (aim for 5 to 10 years ideally)
- Do you sell property too? Or are you just a buyers agent? This question is essential to make sure that they aren’t trying to sell properties, which would create a conflict of interest.
- Previous purchase portfolio? Ask for ten examples to prove local knowledge. What about earlier purchases around your price range?
- Do you have professional indemnity insurance? Buyer’s agents are required to have a minimum of $1 million in protection in case something goes wrong.
- Your network of contacts? A buyer’s agent who has a great list of contacts can help you find properties before they’re advertised.
- Do you own any properties yourself? Your buyer’s agent having a property portfolio will help you to be able to see their track record and financial decisions.
- Are you part of the Real Estate Buyers Agents Association of Australia? Members are to follow strict criteria and are held accountable under a code of conduct.
- Fee structure? What are the agent fees? Compare it to industry standards
- How are your services different to other agents and why should I choose you?
- Can I chat with some of your other past clients? If they say no, this is an issue.
Chapter 3: Best buyers Agent Brisbane reviews
Now that you have all the knowledge needed to go ahead with organising a buyer’s agent, it’s time to decide on the professional services you’re going to hire.
Let’s take a look at some buyer’s agents around Brisbane, and what people are saying about them.
Best Buyer’s Agent in Brisbane
Company & Location
|Streamline Property Buyers|
|We are a local boutique Buyers Agent service with the benefit of having a Licenced Builder, Qualified Property Investment Advisor (QPIA®), an experienced Property Manager on our team – all working together for the benefit of our clients.||Investing in property for more than 23 years and developing property for more than 8 years.||✅Comprehensive service|
✅Advice on which suburbs to target and negotiating contracts
|PMC Property Buyers – Brisbane||Our passion is property, but even more so, to see clients who want to purchase property go into the transaction with open eyes, an understanding of the process and have someone assist them to ensure the best possible outcome that meets their unique goals.||Industry experience and qualifications including; valuations, Master of Project Management, qualified property investment advisors (QPIA), commercial and residential asset management.||✅Took the stress out of the situation|
✅Does all the inspections, checks and negotiating the final price.
|Prosper Group will source both on the market and off-market properties, negotiate the price and terms, conduct due diligence and handle the transaction management of the purchase.||Prosper Group provides specialised residential property services tailored to the needs of home buyers and investors. Since 2005, Prosper Group has built a strong portfolio of satisfied clients.||✅Expertise and wisdom|
✅Great service throughout the negotiation process
My final advice is to have an open and honest conversation with your potential buyer’s agent before committing.
This will help ensure that you’re both on the same page and can work towards a mutual goal, with an outcome in your best interest.
Understand specifically where they fit in your journey and link their commission to your savings to give you the highest chance of success.
So, that is the secret to getting the best value for money with a buyer’s agent.
Now I’d Like to Hear from You
I hope you enjoyed this guide to buyer’s agents.
Now I’d like to hear what you have to say:
Have you ever worked with a buyer’s agent?
If so, how did it go?
Or maybe you have a question about something you read.
Either way, go ahead and leave a quick comment below right now.