Agents new to the industry may well be thinking: “If buyer’s agents work for the purchaser, and I work for the vendor, surely we have opposing interests and therefore I should avoid them at all costs?” Chris Gray, from “The Renovators”, and Your Property Empire explains why this is not the case.
Many vendors want the highest possible price for their property. That often means they need to create a highly emotional connection between buyers and the property, as the goal is to get buyers to fall in love with the property. The higher the emotional connection, the more buyers are willing to pay and to do whatever it takes to secure the property.
Buyer’s agents, on the other hand, are often unemotional purchasers that value property based on recent actual sales. They are therefore less likely to pay higher prices. However, since they charge a fee for their service, they generally represent clients serious about buying property.
Buyer’s agents also normally require that their clients are pre-approved for finance. As an agent, this means you know you are dealing with qualified purchasers rather than a tyre kicker or neighbour that is just taking a sticky beak.
Price is not always the main motivator for vendors. Some people need to sell because they want to secure their dream house elsewhere; others need to sell quickly to reduce their overheads and others might not like the thought of strangers going through their valued possessions.
While you think buyer’s agents may not offer the highest price, they can often offer a quick guaranteed sale in a fraction of the time.
While you think buyer’s agents may not offer the highest price, they can often offer a quick guaranteed sale in a fraction of the time. At other times, buyer’s agents may hold a blank cheque with the instructions ‘buy me that property no matter what the cost’.
A quick sale may be great for your vendor, but it does reduce the amount of exposure you get from having all of those open houses. However, the bigger picture to consider is that if you sell a property in two weeks rather than six weeks, think of the four weeks you have just created, allowing you to get on and chase more listings.
Buyer’s agents can also often be a one-stop shop for multiple sales – great news for agents selling whole blocks or developers’ stock. If the buyer’s agent represents a number of clients all looking for investment opportunities, then they can often act as one to secure a whole development. The quicker and easier the properties sell, the sooner the developer can get on with building the project, and on to the next – and so can you.
As in any other industry, the better your relationships, the more successful you are likely to be. A buyer’s agent can be a reliable conduit between you and qualified buyers.
MY TOP TIPS FOR WORKING WITH BUYER’S AGENTS:
- Offer them silent sales. Many buyers use buyer’s agents because they know they can access properties that are not on the market yet. The more exclusive opportunities you offer them, the more they will value the mutual relationship.
- Don’t try and win all the time. Successful transactions and relationships are all about giving and taking. If you push for top dollar every single time, when you really need them to squeeze another inch to get a deal over the line, they are unlikely to come to the table.
- Sit down and have an honest chat with them to learn how they operate. Get the agent to tell you, what kind of service do they offer their clients? What are their unique selling points? What do the clients expect from them? What annoys their clients? What makes their clients happy? What do they find hard with the buying and selling process? What do they look for in an agent?
- Tell them about your business. Explain to the buyer’s agent what your clients value, is it all about price, speed or some other factor. How do they like to work with buyer’s agents and what frustrates them about working with buyer’s agents?
- Think about the longevity, the volume, and the ease of the transactions you can do together. There is nothing better than being able to shake on a deal knowing that you are 99% guaranteed to get the paperwork within 24 hours rather than playing cat and mouse games over a few thousand dollars.
- Have fun. Whether you are into golf, socialising, sailing, the more you build a relationship outside of work, the better the business relationship builds. People are less likely to risk a business relationship if their families meet socially at the weekend and they have a common circle of friends.
Chris Gray has 20 years’ experience in property investing and education. Chris is CEO of Empire, which searches, negotiates and renovates properties on behalf of time-poor professionals. He is host of Sky Business News Channel’s “Your Property Empire” every Friday, and was Financial Judge on Network Ten’s “The Renovators”. He provides property investment tips and commentary in his regular column, “The Buying Guy”, published throughout News Ltd newspapers. For more please visit www.yourempire.com.au.