Should I use a buyers agent or expert property negotiator to help buy my home?
Scott Aggett, Hello Haus Founder discusses the pro’s and con’s of using a specialist Buyer's Agent vs Expert Property Negotiator for the purchase of your next home or investment. The time for going it alone against skilled agents has passed as buyers realise the importance of levelling the playing field when negotiating one of the biggest investment decisions in life.
Start by asking yourself these questions
Do I have time to:
- Visit open homes in your desired location
- Set property alerts for your ideal property on www.domain.com.au or www.realestate.com.au
Can I understand local property prices:
- Visit live auctions or follow auction results online easily
- Receive free real estate agent emails with their current and sold listings
If you cannot do the easy and free steps above, it’s probably best you employ a buyers agent who can action this on your behalf.
Here are some benefits of working with a good buyers agent:
- Set clear goals to focus on locating matching properties in the area identified
- Work with your budget and shortlist homes for closer review
- Have the market knowledge on pricing / auction clearance rates
- Understand the key reasons to buy or avoid that area or style of property
- Have access to property data for capital growth and rental yield stats + demographic information
Buyers agents typically charge 1.5 - 3% of the total property value, some will offer a flat fee service and all with have an upfront retainer which typically starts at around $5000. On an average value home nationwide in Australia ($625,000) that could equate to a fee of approx. $9,375 - 18,750. In capital cities that could easily be $1.5m purchase price and a fee of $22,500 - 45,000.
BUT … buyers agents are paid for securing you a home, not for saving you money. In fact, the more you spend, the better they are financially rewarded - the system is floored against you as a buyer.
You’ll need a lot of trust when employing the right buyers agents, a professional with the right outlook for looking after their clients and who ensures they don’t overpay. In an industry that advertises to new recruits that they could go from “a barista to a buyers agent” with easy online training courses to earn hundreds of thousands - I would be really cautious who you choose.
I spent 20 years as a selling agent and I set up Hello Haus because sadly so many buyers agents I negotiated with didn’t care about what their client spent, they just wanted to close the deal and move on to the next buyer. It is the same game playing and BS that real estate agents are famous for.
Unless you have been a successful long term selling agent, it’s impossible to understand all sides of the negotiation deal. The agent in the middle needs to balance the buyers needs and the needs of their seller, this is a delicate process. An exceptional negotiator can read all sides of the play and make it work for all involved, they are problem solvers and creative thinkers on the run. How can you do that if you have never experienced the entire process over and over ? Negotiation is a learnt skilled honed over thousands of hours on the job, it’s not something you can learn online in a training seminar.
This is where the decision to go it alone or spend up on using a buyers agent is crucial. Our view is that the right buyers agents can add value to the right buyer, however, it’s a luxury item for the time poor or wealthy and you need to do a lot of homework in who you employ to represent your needs.
98% of Australian home buyers go it alone and locate their own property to purchase for a number of key reasons, mainly, it is fast and easy to search online yourself these days and the property data is often readily available and free of charge. The vast buying public don’t see value paying excessive fees for something they have always done themselves, a lot of people really enjoy the house hunting process too.
What’s an 'Expert Property Negotiator' and how are we different?
I’m focused on two key things:
- Winning the negotiation
- Saving you money
Typically I’m engaged by a buyer once they have located the property they wish to purchase, they will already have finance pre-approval in place and essentially ready to complete their due diligence and start negotiations. It’s at this time that most buyers are highly emotional and at risk of overspending as they have fallen in love with the property and don’t want to miss out.
As a third party to the transaction, I have a structured 8 point strategy that I follow to understand your buying goals, the sellers goals and the agents marketing strategy to understand the bigger picture. Armed with this knowledge I strategise how we can move you through the buying process quickly and with precision, enabling us to make timely offers and secure the property.
I help buyers understand current market value by studying recent home sales, competing listings for sale today and by arranging valuations if required. Together we can workshop the value to arrive at your Target Price - maximum walk way number you wish to pay for the home.
Once the Target Price and sale terms are set, I get to work to secure the home at the lowest possible price.
During the negotiation stage, listening is key to success, I’m asking lot’s of questions and searching for any opportunities, weaknesses that we can take advantage of to lower the price and control the process. Every negotiation is different so there is no one size fits all approach, this is important as I’m constantly being told NO by the agent or seller and need to find other ways around the roadblock to ensure success, 20+ years on the job allows me to draw on past experiences to negotiate around problems.
Our pricing model was designed to give our buyers total transparency, something sadly missing from the smoke and mirrors property industry.
Upfront retainer $1995 + Performance fee 15% of the savings made below the Target Price you set.
Example - You locate a home for $650k, set us a Target Price of $630k, we purchase it at $610k - Savings made below the TP is $20,000 x 15% = $3,000.
Total = $1995 + $3000 = $4995 + GST
Hello Haus are charging you out of the transparent savings we can show you we have made, whilst also giving you the peace of mind that you have paid the least amount possible to secure the home.
Whether you’re buying for $300,000 or $3,000,000, the results are consistent, we save thousands. Take a look at what it means to some recent Hello Haus customers.
Rei & Son, Belmont, VIC | Investors | Target Price $520,000 | Paid $500,000 | saved $20,000
'We engaged Scott to negotiate for us as soon as we found the property after much research. Providing Scott with comparable sales in the area, he knocked $20,000 off our target price. He kept us in the loop and gave us advise along the way. We highly recommend Hello Haus.'
Lorraine & Col, Down Sizers, Banora Pt, NSW | Target Price $550,000 | Purchase Price $535,000 | Savings $15,000
'I really thought we would have to pay the full list price however I was over the moon when Scott came back to us 24 hours later and had secured our dream property at the best price and even saved us an extra $15,000. This meant so much to us as we will never have an income again. Thanks to Scott we are now in a better financial position that enables us to have a “buffer zone” going into retirement.'