Selecting a Buyer Advocate in Melbourne

Key points to address when choosing your Buyer Advocate in Melbourne.

1. Where is the buyer advocate's core business operation located?

There are some buyer advocates that specialise in sea change property, for buyers wanting to buy a sea change – that makes sense. However make sure you use a "Sea Change" buyer advocate that is local to the Coastal Towns you have short listed.

Using a buyer advocate that is based in the outer Northern suburbs to buy you a property in the inner Southern Suburbs doesn't make sense.

You should seek to use a buyer agent that is based local to your target area of purchase. You should be seeking a buyer advocate that will not only save you time and money but an advocate that can advise you on local history, demographics and dynamics of the location.

If you don't have a preferred location to buy in, you need to do more research, seek a no obligation discussion with several buyer advocates, attend genuine educational property seminars and subscribe to property and investment forums.

The opinion of Real Estate Angel:
You will be at greater chance of a successful real estate purchase if you choose a buyer advocate that is local to the suburb you wish to purchase in, within a 5km radius would be a good guide.

2. What price band in the market does the buyer advocate regularly deal with?

The market intelligence a buyer advocate develops is more acutely fine tuned to the price band they are regularly working with. A buyer advocate that is walking through half a dozen homes a day priced between $300,000 - $450,000 has a better understanding of the market in this price band than does an agent who only inspects property priced $750,000 to $1,000,000.

To get a good feel for the buyer advocate that is best suited to working with your price range ask what the value of their last 5 property transactions were. At least 3 should be within 10% of your budget.

The opinion of Real Estate Angel:
If you are buying a multi million dollar property give preference to employing a buyer advocate that is a specialist in buying multi million dollar property.

If you are buying a first time investment property with a low end budget, seek a buyer advocate that specialises working with "Mum and Dad" investors in the entry level markets.

(Remember: They must also know your target location extremely well.)

3. Is the buyer advocate a completely independent operator?

Some buyer advocates have been known to have "very friendly relationships" with developers, selling agents and builders. The scenario for the consumer to avoid here is paying a secret commission or referral fee that has not been disclosed.

The opinion of Real Estate Angel:
You as a real estate buyer and client of any buyer advocate service are entitled to transact in real estate that is completely free of secret commissions. The property the buyer advocate sources and selects to present to you for purchase should be based on being the best suited to your purchase and investment criteria not on the basis of a secret commission or additional referral fee. This behaviour should be reported to your Sate Office of Fair Trading and Consumer Affairs.

4. How is the buyer advocate service fee structured and does it seem fair?

The typical types of fee structure for the full buyer advocate service of identification, search and assess, negotiate and purchase is by either:

A percentage of the sale price – this figure seems to vary by value of the property between 1% and 2.5%
Or
A fixed flat fee that depending on the exact level of service required will vary from $4000 to $20,000

Most buyer advocates will offer one free and no obligation initial consultation.
Most buyer advocates will request a small payment up front as a deposit to begin their search. It is normally 10% of their total fee.
Some buyer advocates will request a progress payment depending on the length of time they have been searching. For example they may request a further payment of 50% after 30 days to continue searching.
Most buyer advocates will not charge the balance of their service fee if they have not been able to find you "the property".
Some buyer advocates only charge a single fee based entirely on finding you a property.

The opinion of Real Estate Angel:
The fee structure should be easy for you to understand and it should sound fair and reasonable.
It should be clearly written into the service agreement.
Real Estate Angel have a preference for negotiating a flat fee structure that is a fixed figure and completely accepted by the client (YOU) as being fair.

5. What is the relationship of the buyer advocate with associated real estate services such as property lawyers, accountants and conveyancers' / mortgage lenders and financial planners?

This question doesn't necessarily have a bad answer a complete one stop in house service may be exactly what you are after.

However be aware that you may not gain the same competitiveness of pricing.

Be aware that the advice of a "one stop" service may be biased with the interest of each service provider serving itself as a single network.

There are buyer advocate groups that do this very well and that are very fair about it.

Unfortunately there seems to be a group or two every boom cycle that comes undone for taking unfair commissions and restricting free market practices.

The opinion of Real Estate Angel:
Beware of the next Henry Kaye.

6. How long has the buyer advocate been in the real estate industry for? How much real estate sales negotiation experience does the buyer advocate have? How much is enough?

Do not shy away from asking the question of experience and specifically in what areas. Some buyer advocates enter the business with little actual "real estate sales" experience. Some buyer advocates come from backgrounds that have been focused on property management or property valuations; while still valuable experiences it would not compare with a buyer advocate who has gained their experience working actively in real estate sales for at least 10 years.

The opinion of Real Estate Angel:
Before a buyer advocate could claim that they are an expert and capable of managing your property purchase they should be backed by a minimum of 5 years experience actively working in real estate sales. If you are buying a commercial property then this should be 5 years of commercial real estate sales experience.

Would you like us to work for you?

Help is at hand, for a quicker, easier and successful path to a profitable real estate purchase.
Please call Jason Wier, the owner of Real Estate Angel on 0414 288 038 for a friendly chat about your buying plans.