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Everything You Wanted to Know About Using a Buyer’s Agent to Buy a Home

Everything You Wanted to Know About Using a Buyer’s Agent to Buy a Home

Judith
September 20, 2020

We’ve all heard of them but what actually is a buyer’s agent and what do they do?

The basics

A buyer’s agent is a licensed professional who represents, you guessed it! - the buyer. In this case, you. They are perhaps best described as a real estate agent’s opposite. Real estate agents represent the vendor: the person selling the property. 

In short, a buyer’s agent’s job is to identify potential properties for you to buy and then negotiate the purchase on your behalf.

The pros

Access | Buyer’s agents often have access to a larger range of properties than what is publicly advertised through a real estate agent firm. Some sellers choose not to publicly advertise their property due to privacy concerns or to decrease the amount of ‘open home’ showings for which they have to prepare.

When this is the case, a real estate agent would connect with buyer’s agents in their area/network and shop the property out to them, hoping that the buyer’s agents would have clients interested in viewing said property. 

Market know-how |  Buyers’ agents pride themselves on having expert knowledge about the property market. They can give you investment advice and tips, including which property is right for your financial situation, the timing of when to buy, and the benefits of buying a property in a certain area or suburb. 

Time & energy saving | If you’ve tried to buy a property in a competitive market, you will know how time-consuming and draining the process can be.

Using a buyer’s agent can save you time and energy as they can identify properties that are of real potential to you. Instead of the traditional process of going to an inspection without much prior knowledge and finding out that the property is not suitable for you, a buyer’s agent will already have scoped out the main benefits and issues of a property before you’ve even seen a photo of it! 

Your buyer’s agent might also be able to ascertain approximate property prices, meaning you won’t waste your time (read Saturday mornings) on viewing property that is out of your price range. Some buyer’s agents will even arrange property inspections and reports for you. 

Bidding & negotiating on your behalf | One of the biggest advantages of using a buyer’s agent is to bid and negotiate on your behalf. If you’ve been to an auction before, you will know that it can get quite stressful and it can be a pretty intimidating environment for people new to the property buying process. However, a buyer’s agent can attend auctions and bid on your behalf without you even showing up. 

Likewise, if a property is being sold by private treaty (not through an auction), your buyer’s agent can negotiate with the real estate agent or vendor on your behalf. Generally, they will be experienced negotiators, well versed in all the tricks of the real estate trade and therefore, more adept at securing a fair price for you. 

 

The costs

Pricing structure among buyer’s agents vary. Some will charge an ‘engagement fee’, which basically translates to an upfront flat fee. This is paid before they start representing you. 

Other charges would follow once a suitable property is secured for you. Common pricing structures can include a percentage of the property’s purchase price or a flat fee once the purchase is complete. 

Buyer beware

Important considerations before you engage a buyer’s agent:

  • First and foremost, make sure they are licensed. If you are unsure, you can use this government search tool to find out. Click here
  • Make sure they do not accept commissions from developers or vendors. They should be acting in your interests only
  • We always suggest getting a personal recommendation if you can. Ask family and friends - hopefully, someone close to you or a ‘friend of a friend’ can pass on the details of someone they worked with who did a great job
  • Double-check their fee structure so you won’t be met with any nasty surprises. If you are unsure about any of their terms and conditions - don’t be afraid to ask! Just remember, no question is a stupid question - especially when money is involved
  • If you’re wanting to purchase an investment property or a property on which you are looking to make a return, make sure the buyer’s agent you choose has experience in the relevant area/suburb you are wanting to buy in. This will mean they are more likely to give you accurate advice on that particular market and that they will have local knowledge

Questions to ask a buyer’s agent before hiring them

  • Are you licensed? 
  • Do you have any additional, relevant qualifications?
  • Do you take commissions from developers/vendors?
  • What is your specialty? Forever homes, investment properties etc.?
  • What areas/suburbs do you work in? 
  • How long have you been in the profession?
  • Are you an investor yourself?
  • Have you ever worked with someone whose circumstances were similar to mine? How did that turn out? Were you able to secure them a property?
  • Can I see some recent examples of what you were able to secure for your clients?
  • What is your point of difference? What can you offer me as opposed to other agents out there?

 

Still need some more info? We’re here to help. Get in touch through our contact page.