‘Tactics and strategy’: How to buy property like a buyer’s agent

“It’s always a good time to buy property, and it doesn’t matter whether the market’s bullish or whether it’s a bear market. There is a bargain to be had, whether because of the three dreaded D’s — debt, death and divorce — or a seller needing money urgently, or an agent who has underpriced a property.

“There’s always a bargain to be had if you’re out there actively looking.”

For a lot of investors, there is big value added by having buyer’s agents in their investment team who allow them to make smarter decisions through “local ground knowledge” acquired by consistent and active research of the market.

However, Mr Skeen believes that, with the right amount of dedication, investors can find themselves a diamond in the rough across the vast property market.

According to him: “Yes, a buyer’s agent is great, but I can tell you that there’s some great investors out there that are actively looking six to seven days a week to find that diamond in the rough… You can do it yourself if you have the skills and capabilities to do so.”

Buying like an agent

While there are hundreds of strategies that could be implemented by property investors, Mr Skeen said that smart investing ultimately comes down to two simple steps: education and negotiation.

Education

One thing that sets buyer’s agents apart from an average investor is their exposure to the market. Their experience with extensive ground-level research allows them to get a more in-depth knowledge of the different markets across a specific area.

In order to make smart decisions like a buyer’s agent, investors are strongly encouraged to dedicate time and effort towards educating themselves through several channels — beyond texts and theories.

Mr Skeen said: “If you’re going to invest in that particular suburb, educate yourself as much as you can on the values of the area by attending all the auctions and seeing what’s selling.”

Negotiation

Once the investor has been oriented on the trends in the market, from prices to aesthetics, Mr Skeen advises them to formulate a negotiation strategy.

The buyer’s agent said: “A negotiation strategy is simply for securing the property under market value. Let’s look at the motivation.

“Question the agent: Where the owner’s going? Why do they need the money? How long has it been on the market? Why are you asking this price? Get them to justify it, especially now that the market’s come down. They might still have expectations off of last year where the markets were a bit higher, or even the owner’s got higher expectations. Just question, question, question.”

Apart from finding out the motivation for the sale, a negotiation strategy also entails working out the details of the investor’s offers.

According to Mr Skeen: “Start with an initial offer that is extremely low, then the second offer should be a little bit more substantial. Before making the next offer, really consider the counteroffer or what the owner is willing to accept.

“Then, from there, once you’ve done all your due diligence in the background, you can make your third and final offer. With the counteroffer in mind, once again, try to go in lower, this time while being ready to sign a contract and give a 10 per cent deposit.”

He concluded: “It’s really all about tactics and strategy.”

Tune into Robert Skeen’s episode on The Smart Property Investment Show to know more about the winning strategies in today’s property market.

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