Buying a property in Canberra? Use a licensed buyer’s agent.
Buying a property can be stressful and time-consuming at the best of times, from scouting to final settlement.
However, since the turn of the century in Australia, the buyer’s agent has come to the fore. These professionals help you navigate the perilous property market and find you a home within budget and to the specification you wanted, so you don’t settle for second best.
Trying to be successful in the Australian property market without professional help is daunting. It is why we have seen such exponential growth in buyer’s agents in the last 20 years.
In this article, I look to emphasise what a buyer’s agent does and what to look for to choose the right one for you.
What does a buyer’s agent do?
Buyer’s agents are specialists in researching, evaluating and negotiating on behalf of their clients.
There are two primary services agents are involved in:
Often referred to as full service, this consists in assisting you through the entire process to completion. When looking for property in Canberra, after an initial evaluation with you, they will search for properties that meet your specification and look to acquire at an auction or deal directly with the seller.
Auction bidding only
If for example, you have found a property you want you can employ a buyer’s agent to assist you at auction. If you have no auction bidding experience, Canberra auction property bidding can be ruthless. So the buyer’s agent will represent you on the day. Real estate investors or overseas buyers mainly use this.
How much does a buyer’s agent cost?
Most things related to property purchasing is expensive, and buyer’s agents do cost money. Fees vary according to the level of the service you require. The usual categories are:
You can agree a fixed fee or a flat rate which is dependent on the value of the brick and mortar you are looking to acquire.
Generally, this is the more common method which is why buyers agents are popular. As a ballpark, you will get charged at 1.5% – 3% of the final purchase price, plus GST.
Regardless of which method you have chosen above an agent may ask for an upfront fee for their work. They begin work immediately so this is to safeguard against you suddenly decide you don’t want to move after weeks of work being conducted by them.
As long as everything is clear and transparent at the start, rest assured a buyers agent will save you money in the long-run.
Experience is what counts when using a buyer’s agent, and you will see the difference almost immediately:
- Local insights. A buyer’s agent has extensive knowledge of his or her local area, town, city and in some cases, state. They won’t just look for a property that ticks the physical boxes but look for areas with strong capital growth potential.
- Time savings and less stress. The services of a buyer’s agent can save you endless hours of dead-end disappointments, turning up at a location to find out it wasn’t what you thought it was. Plus, suddenly the price just went up due to other interest (which in many cases was non-existent).
- An objective view. Choosing a property is one of the most significant investments many people make in their lives. Emotions are also involved, particularly if you are looking to raise a family there. A buyer’s agent considers this and only puts suitable properties in-front of you, at the right price.
- Early property access. The most significant advantage that a buyer’s agent brings to the table is a network of real estate agents they have already extensively worked with over the years. They have the inside-track and access to off-market properties. Meaning they haven’t even gone on the market yet! You could be first through the door. And guess what? When there’s no competition, there’s no price war!
- Professional negotiation. Even property buyers that are significant players in the city are not always comfortable with face to face negotiations. A buyer’s agent represents you and gets the best price possible. At an auction, they know when to bid and most importantly, when to walk away.
Choosing the right buyer’s agent
Research. The internet is your best friend, make sure you do plenty of searches such as Canberra property for sale, property purchasing and Canberra property auctions for example.
Companies that continually arise on the first page of Google are a good place to start. Then start looking at online reviews and looking at the kind of properties they have acquired for customers in the past.
Make sure when you sit down for the first time to explain clearly your budget, location preferences, and if it compliments and investment strategy. Remember the vaguer you are; then you are trying their hands behind their back. Give them the tools and let them go to work for you.
Once you have a shortlist buyer’s agents that on the outside seem to fit the bill, it’s the interview process time. Here’s a guide to hiring the right buyers agent ACT:
- What experience do you have? 5-10 years’ experience in the area(s) you are looking for is a reasonable starting point.
- Are you an exclusive buyer’s agent? If they also sell property, be careful. You could find yourself dealing with a conflict of interest as they may be more interested in steering you towards purchasing one of their listed properties.
- Do you hold professional indemnity insurance? For your information, it’s the law that all buyer’s agent holds a minimum of $1 million of professional indemnity insurance if they don’t then scratch them off your list.
- Have you made sales in my preferred location? Are they the real deal and can they show you a proven portfolio, if they can GREAT, they have local knowledge.
- Are you REBAA registered? REBAA is The Real Estate Buyers Agents Association of Australia and has strict membership criteria, be careful of using an agent who is not a member.
- What is your fee structure? It’s stating the obvious right? However, this needs to be set in stone from day one and, of course, compare it to industry-standard commission against the other agents on your shortlist.
- Can I talk to previous clients? Website testimonials are one thing, but real testimonials you can’t beat! A good agent should have no hesitation in recommending you speak to one of their clients, given that the client permits to do so, but they should have an extensive portfolio. If they decline, time to move on swiftly to the next agent.
When buyer’s agents first hit the market, many people didn’t know what to make of the industry and perceived them to be agents for yuppies on the back of the dot com boom. Times have changed, and anyone that has used a buyer’s agent will tell you they’ll never try to do it alone again. Use the guidelines above; find the right one, and good luck!