Auctions: who do you trust to do your bidding?
A Sydney real estate sales agent blogged this month how they worked with a buyer. 'I always like to help buyers out when they are bidding, give them a mini strategy so that they can be the winners. This buyer, I have to admit was easy... She just said yes to every bid I pulled out of the hat for her.'
The agent continues, 'But when you're spending other people's money what's $10,000? Don't despair .. I did try and make her bid against herself and increase her bid... It's always nice to hold another person credit card in your hand..'
Oh, where to begin. I'm so disappointed reading this, it sounds to me like they're purporting to help the buyer when in fact they're clearly acting for their seller.
By law, agents cannot act for both the buyer and the seller. It's illegal. If the selling agent truly helps a buyer to get the best price they would be going against their fiduciary duty of care to their client - the vendor. With most agents working on a commission basis, they'd also be doing themselves out of income and pride for sale prices they'd achieved. The good agents I know are in for the long game and would never do anything to tarnish their reputation as a top selling agent.
Auctioneers and agents are in full swing during an auction. It's showtime after weeks of open homes. You've probably seen multiple agents at an auction who are ever-present. They're not there by accident. The selling agents are working for their vendor and the promotion of their agency. They lack the independence from the transaction to really help the buyer because each party's goals are polar opposite. This buyer had no ally, 'mini strategy' or not.
Let's be clear.
Spending other people's money is not to be taken lightly. With great power comes great responsibility (yes, I am quoting Spiderman's uncle but he makes an excellent point). It takes time, discipline and sacrifice as a buyer to build up your deposit and be ready to commit those funds to a purchase. There's nothing flippant about another $10,000. Further to the time, effort and cost of repaying that extra money, there's additional stamp duty, interest costs and the opportunity cost of those funds for the buyer too.
If it were as simple as having the most money to spend with no regard to the final price, any man, woman or child (or your dog) could do that. If you want to pay the lowest possible price to secure the property there's far more to the process than the untrained eye can see. You don't know what you don't know, which is why my clients seek my services. Be cautious of anyone offering you a free service - why would they offer it for free? Consider their motivation, if they are ultimately rewarded in another way for doing so, whether or not they are licenced, and do they really have the proven ability to get you the best outcome? After all, your bidder holds the reins to your finances.
'An investment in knowledge always pays the best interest' (wise words, Benjamin Franklin).
Engaging an experienced buyers agent who has bid successfully on countless auctions, seen it all before and who will remain calm and in control no matter what transpires is the intelligent buyer's choice. A buyers agent's detachment and professional conduct puts you in a position of strength. They will sway the odds in your favour and give you the upper hand over your competition when other bidders are emotional and unsure. It's written all over their body language, if you only know what to look for and how to act when the heat is on.
Property is not cheap. Whether it's a unit for $250,000 or a blue-chip multi-million dollar home, it's often the largest financial transaction you'll ever make. Appointing a professional to get the best outcome is a sensible move for both your finances and your stress levels. You don't want to blow the opportunity to get the best deal by getting caught up in the moment or put your faith in the wrong person. There are skilled buyers agents working across Australia (REBAA has a comprehensive list of those who meet stringent membership requirements) who work only for you, and whose profession is negotiating and buying property week in, week out. Level the playing field on auction day and you'll have the greatest advantages of all - a wealth of experience and true independence on your side.
Contact me to find out how I can help you at auction.