What Is A Buyer’s Agent?
To put it simply, a buyers’ agent (or buyers’ advocate) is a licensed professional that represents international property buyers, investors and developers in purchasing residential and commercial real estate.
Buyers’ agents (advocates) in Australia play a key role in helping expat buyers complete successful property negotiations. They specialise in the search, evaluation and negotiation of the best possible price on behalf of the buyer.
Clarifying the budget and key criteria, goals and strategy for real estate in Australia, buyers’ agents assist international buyers with every part of the journey of purchasing their dream home or investment property. This includes, where needed, vendor advocacy and auction bidding as well.
So, what's the difference between a buyers' agent and a real estate agent?
A lot! Buyers’ agents do not sell real estate like in other international markets, for instance, multi-agents in the US. It all comes down to representation. Suppose you don’t appoint a buyers’ agent. You have no one to represent you while negotiating with vendors and their sales agents.
So, why is that a problem?
The sales agent is tasked to achieve the highest possible price for the vendor. The buyer’s agent’s job is to achieve the lowest possible price for the buyer and secure the property ahead of the other buyers. A sales agent cannot act for both parties, so investing in a buyers’ agent upfront to complete your goals will get you the best outcome.
The buyers’ agent should advocate exclusively and independently in any property negotiation. For instance, at an auction or negotiation via private treaty, the buyers’ agent stays emotionally neutral. This helps them to leverage their expert negotiation skills to secure the lowest possible price and favourable contract terms.
Buyer’s agents typically use methodical and transparent approach. Property insights on the constantly changing market provided by the buyers’ agents are invaluable for Australian expats. Expect to see comparable sales analysis and capital growth projections as a home buyer. Add investment and yield analysis to that if you are purchasing an investment property.
What services do buyers' agents offer?
If you’re a foreign buyer or an Australian expat looking for prestige property, a buyers’ agent can significantly reduce the level of competition you can expect. Buyers’ agents offer several services tailored to your brief.
Still, most clients will enter a full search, appraisal and negotiation service. This includes the full search service whereby the buyers’ agent finds and shortlists properties meeting the client’s search criteria. They then evaluate and negotiate the recommended property.
If you find several properties after conducting your Australian real estate search, you can engage a buyer’s agent to conduct the negotiation or auction bidding-only service.
In case you’re looking to buy property in one of Australia’s capital cities (i.e. Sydney, Melbourne, Brisbane) or fringe centres (i.e. Gold Coast, Newcastle), it is best to use a local area specialist buyers’ agent. They will ensure you have access to specific data that pertains to that market and provide you with excellent local knowledge.
Engaging a reputable buyers’ agent is easy, and the fee structures are affordable and fair. Buyers’ agents are not expensive, and they typically more than makeup for any fees going into the negotiation. Using a buyers’ agent saves you money, time, poor decision making and unnecessary stress.
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How much do buyers' agents cost?
For Australian property investors, the buyers’ agents’ fees are tax deductible on the sale of the property once you declare capital gains tax. Buyers’ agents generally charge an engagement fee before they begin the search. The fees are either a flat fee or a percentage of the property purchase price.
Most buyers’ agents charge around 2% for the full search service, which includes the following:
- A strategy session
- Suburb profiles
- Identifying suitable properties
- Inspecting, evaluating, negotiating and attending to settlement inspection
Fees for appraise and negotiate only services are typically around 1% of the purchase price (or fixed fee equivalent).
Finding a buyers’ agent is easy when you start with a search on REEBA (Real Estate Buyers Agents Association), the leading Australian property and real estate organisation for buyers’ agents.
Here are 7 key reasons why Australian Expats should consider using a buyers' agent
- Access more properties (off-market/ silent listings) via the buyers’ agent’s local area network.
- Leverage your time – instead of searching the internet every weekend, get someone else to do the hard work short listing suitable properties.
- Use a professional negotiator to obtain the lowest possible price.
- Eliminate the stress and frustration of being shown inappropriate and unsuitable properties by selling agents that don’t listen to your needs.
- Receive independent advice – the buyers’ agent is on your side!
- Find the right property type in locations with good prospects for capital growth.
- Teamwork – The buyers’ agent typically has some great connections they can refer. This includes finance brokers, building inspectors, solicitors, conveyancers, accountants and others that can make your purchase a breeze. Having the right team of experts makes things that much easier.
So where do mortgage brokers come in?
In order to improve your chances of obtaining your dream home or investment property, mortgage brokers try to get you the best services possible within their reach.
Odin Mortgage can help you maximise your borrowing capacity so that you can secure your desired property even if you are an Australian expat living overseas. Please speak with one of our specialist expat mortgage brokers to get a free assessment and start your home buying journey.