an insider's guide to buying quality real estate
TRANSCRIPT
An Insider’s Guide to Buying Real
Estate in partnership with
EPS Property Search
Any advice contained in this presentation is general advice only and does not take into consideration the reader’s personal circumstances. Any reference to the reader’s actual circumstances is coincidental. To avoid making a decision not appropriate to you, the content should not be relied upon or act as a substitute for receiving financial advice suitable to your circumstances. When considering a financial product please consider the Product Disclosure Statement. Stanford Brown is a Corporate Authorised Representative of The Lunar Group Pty Limited. The Lunar Group and its representatives receive fees and brokerage from the provision of financial advice or placement of financial products. The Lunar Group Pty Limited ABN 27 159 030 869 AFSL No. 470948.
Disclaimer
Patrick Bright, EPS Property Search
• They help home and investment property buyers (not sellers)
• They don’t take fees from anyone other than their buying client (no conflict of interest)
• They guide their clients to purchase above average homes and investment properties
What is an exclusive Buyer’s Agent?
• One point of contact for buyers to be able to access the entire market.
• Allow buyers to deal with one person / buyers agent acting in their best interests not hundred's of sales agents who are not
• Good time leverage for busy people• You could hire a dud• They cost $$$. Typically anything from 1-3% of
purchase price depending on the type of service provided
Pros and cons of hiring a buyer’s agent
• Off the plan• Established• Buy renovate hold / sell• Highest and best use
New versus established property pros and cons
Moving strategies without ending up homeless
• Can you finance the buy without selling first? If yes great!
• Buy first with a long settlement (risk level dependent on what you have to sell and state of the market in the suburb your selling in)
• Sell first with a long settlement (still a bit risky in the current market)
• Be on the market “quietly” whilst looking to buy• Sell with a rent back clause in the contract
Buying investment property
• Is it ok to buy a property sight unseen?
Example ad you may come across...
• Single level 3 bed family home• Great condition – good renter, large amounts of free
flowing fresh air• Some renovation work required• North facing with good natural light• Motivated vendor – will throw in bonus car for free
Don’t believe the selling agent ads!
Another example ad you may come across…
• Two story brick home • North / East facing • Some work required• Going for a fire sale price
Don’t trust what you see online
Original Same photo altered by adding 5% light and clicking and dragging
left edge of photo
Never buy a property unseen!
Where to invest with a margin of safety
• The inner ring of capital cities • As a general rule stick to plus or minus 20% of the
median price for the location / suburb • Find the sweet spot for ROI• Supply and demand is a key driver of any market so
make sure there is plenty of demand now and will be in the future
• Stick to my 20 – 25 – 20 rule
What to buy?
• A grade – 10% of the market• B grade – 20% of the market --------------------------------------• C grade – 40% of the market• D grade – 30% of the market
Key elements of negotiation
• Build rapport• Information• Motivation – Vendor’s and Agent’s• Low need
Key elements of negotiation (cont)
• Never be the first to name a price • Terms versus price - which is more important?• Use deadlines• Take the focus off the price
• Think rock climbing• Bridge the gap• The “I love it offer”• I don’t care where you start• Put your offers in writing
Negotiation in action
What to expect at auction
What to expect at auction
• You will be nervous • Pressure for you to
bid • The blank cheque
book buyer • Do auctions get the
highest price or the second highest price?
• Don’t bid against yourself
• The reserve to be above the price guide
• A lotto outcome for the buyer and seller
• Buy well or don’t buy
Top 6 mistakes to avoid…
1. Buying without finance pre-approval in writing
2. Making a fed up purchase
3. Borrowing at your limit
4. Not conducting pest and relevant building inspections
5. Listening to friends and family
6. Relying on data reports
Don’t be shark bait.. Do your research!