Property 101: Buyer's agents aren't just for the wealthy: Rich Harvey

GUEST OBSERVER

It was no surprise that the current competitive property market was causing many home buyers to lose sleep.

According to a survey released last week by St. George Bank, more than 50 percent of the 1,000 first home buyers surveyed were losing sleep over the property hunt while 25 percent found themselves losing focus at work.

Unfortunately there was a common misnomer that buyer’s agents were just ‘for the wealthy’ and not for the average Australian home buyer.

The old adage ‘you’ve got to spend money to make money’ was particularly relevant when engaging a buyer’s agent and first home buyers needed to be made aware that professional help was available.

What a lot of people don’t realise is that an investment in a professional who’s been buying property for 10 or 20 years, who has the contacts and knows how to negotiate, is actually making you money and saving you money all at the same time.

Generally speaking extremely wealthy people can afford to lose more money than your average first home buyer.

It comes down to a level of risk and the average Australian first home buyer is not able to take that level of risk without professional advice.

You only have to look at the average house price 10 years ago to now to see how prices have jumped in every capital city around Australia.

Hindsight shows what you would have made in capital growth versus the cost of engaging a buyer’s agent.

Likewise by panicking and either overpaying or not doing anything at all costs a whole lot more than engaging a professional.

When it comes to fees, there is no industry standard however the general rule of thumb is a two percent commission plus GST on the purchase price.

On the flipside, some buyer’s agents choose to charge a fixed fee.

It very much depends on the suburb you’re buying in, the price of the property and how much of the service you want to pay for.

Maybe you’ve done all the research and you simply want an independent third party to validate your opinion or you would like a buyer’s agent to bid on your behalf at auction.

At the end of the day you need to find the right buyer’s agent that’s giving you the right level of service.

Like anything in life, quality comes at a cost.

Rich Harvey is REBAA president and can be contacted here.