Today’s auction model is designed to return maximum dollars to the pocket of the vendor. Below are three reasons why:
- Auctions are designed to create uncertainty, excitement and tension in buyers. This heady mix of emotions serves to push bidders to extend themselves beyond their price ceilings and what they logically know to be reasonable.
- Real estate Agents under quoting: All too often, potential buyers are offered price estimates that fall notably short of the final sale price, in order to ensure that as many interested (and emotionally attached) parties at the auction as possible.
- The third factor, of course, is lack of preparation and research. You are almost certain to underachieve in this market without studying comparable local sales, acquiring the proper inspection reports and having a reasonable understanding of the current market dynamics.
Situations where buyer’s agents save clients money
Dummy bids: We have talked to auctioneers in the past and “encouraged them” to stop running the bids up and on several occasions identified bidders to prevented dummy bids from pushing up the price on our client.
Post Auction Negotiations: We have let properties pass in at auction and entered into post-auction negotiations straight after and bought below the pass-in figure.
Real Estate agents and under quoting: We have saved countless clients from wasting their time and money getting building and pest inspections and paying us to attend auctions where the property was drastically underquoted. In every case these properties sold for well above our potential clients’ financial capacity.
No emotional bidding: an advocate understands market value, in other words knowing a good market purchase for the property there bidding on. With current conditions most properties over exceed previous market prices and it takes real estate exprience in knowing when to walk away.
In making any large purchasing decision you always consult a professional to protect your best interest. Consider the example of buying shares.
Would you invest $20,000 into the stock market with out understanding what the market is doing? How the company is preforming? Is there any foreseen future volatility that can affect the stock positively or negatively? Most people would seek the assistance of a stock broker to avoid massive financial loss.
Buyer’s advocates are the stock brokers of real estate. The difference between them and the traditional agents are buyer’s agents only represent the buyer. An Auction can be daunting, stressful and has a high stakes outcome. Having professional Buyer agent at your side to do the bidding for you is invaluable.
At Wise Real Estate Advice, we ensure all boxes are ticked and that sincere care is taken when providing a buyer with the wise advice and action required throughout the buying process. To speak to one of our friendly buyer’s agents click here to fill out an enquiry form or just simply call us on 1300 00 WISE.