Recently, I’ve been clarifying what exactly a BA is, what BA’s do and the most frequently asked question, how can they help me?
Many people are familiar with what a selling agent is, often called a real estate agent. They represent sellers and help list their properties to sell with the main objective to get the highest possible sale price (in return they charge a fee, typically 2–3%).
A BA does the exact opposite.
So, what exactly is a BA?
Put simply, a buyer’s agent (buyers advocate) is a licenced real estate professional that works only for the buyer, not the seller.
A BA will act on behalf of the buyer by firstly understanding their needs, followed by searching for properties that match these needs. We also negotiate on the property and act solely in the best interest of the buyer.
A good BA will also aid in the organising of building and pest inspections, solicitors or conveyancers, property managers (if needed) and informing you along the way.
In Australia, a BA is a relatively new idea. Whilst there are over 75,000 selling agents across the country, there are roughly 500 BA’s across an entire nation. However, BA are not a new concept at all. In the USA almost 80% of properties are purchased using a BA.
BA’s charge the buyers a fee which is often recouped in savings through negotiation and better performing property. At the very least, we aim to save you tens of thousands if not hundreds of thousands in big mistakes you could potentially make yourself by purchasing without the expertise of a BA (Read about mistakes later in the article).
OK, but I can buy property by myself, why should I use a BA?
Another question that is often asked after explaining what a BA is; why should I hire a BA? ‘buying property is easy, I can do it myself’.
There are numerous reasons why a person should use a professional BA.
When you are buying a property on your own you are competing with a professional seller, a professional negotiator. You are dealing with someone who negotiates all day, every day with all the latest market data.
It isn’t a fair fight. Having a BA levels the playing field, it gives you someone in your corner that also negotiates every day, someone that also has all the latest market data, someone that is in the market daily. It gives you the edge over other potential buyers. This is where the value is, someone with market perspective and expertise guiding you along the way.
I’ve compiled a short list of 8 points below, that may help identify if using a BA is for you:
1. Time poor
Are you a busy professional? Do you have a family to look after? Have you found yourself saying “I don’t have enough time”. “I’ve got so much to do”. Between a full-time job, a family, and trying to have a life, you may just not find enough hours in the day. You may think this isn’t you, but ask yourself the question, how many properties do you do a full in-depth analysis on a week? A BA will go through hundreds. If this is you, then a BA will be of great value to you.
2. Frustrated with dealing with real estate agents
“Why won’t they just tell us the price?” “Are they playing games with me?” “Is there really someone else interested in this property?” Found yourself asking these questions? A BA has built connections with real estate agents and they speak the same language. If you are frustrated by the process or dealing with agents, then a BA will be of great help.
3. Sick off missing out on property
You’ve spent a month worth of weekends at open homes, put an offer on multiple properties and they just always go past your budget! If this sounds like your situation, a BA will be able to help. A BA will perform an in-depth data analysis and market research which helps narrowing down options for your budget. A BA’s relationships with real estate agents also help to get the deals done.
4. Over the process
Purchasing real estate can be a stressful, long and tiring process and not to mention, emotionally draining. Perhaps you’ve tried before and have been unsuccessful, or you are a seasoned investor but are just over the process. If this is you, a BA can help.
5. Overseas/ Interstate
Do you live overseas, or perhaps you live in another state that you wish to buy in? Many BA’s are borderless and search the entire country on your behalf, ensuring that the best property for your needs can be sourced.
6. Concerned that you aren’t getting access to all property
Off market property is a real thing, and unless you have connections with agents, unfortunately you won’t get access to them. Sometimes off market property can present a great deal for your situation. BA’s are continuously aiming to work with agents all across the country to ensure that they are presented with these opportunities on your behalf.
7. First home buyer
Are you a first home buyer? Are you confused about the entire process? Don’t be disheartened. It can be a long, tricky process and sometimes you just need a helping hand. Great BA’s love to educate and inform so you are never left in the dark. First home buyers can find a BA incredibly helpful, not only for the purchase but also for their understanding.
8. Acknowledge and appreciate the industry experts.
Perhaps you don’t fit in any of the above categories, but you simply acknowledge and appreciate that industry experts will be able to help you purchase property. Would you sell your own home? Would you seek a pharmacist’s advice before using new medication? Would you fix your own car engine? If your answers to these questions are the same as ours, then we know you would want an industry expert to help you purchase your home. Why? Simply because they do this all the time, they know what to look for, what to look out for, they have the connections, and they want to help.
Ok, I can see the benefit in using a BA, but I’m not totally convinced!
So, you’ve read the above, you fit in one or more of the categories, but you aren’t totally convinced in using a BA. I’ve listed a few very common mistakes that non professional individual buyers often make.
1. Emotional decisions
You know you shouldn’t get emotional about it, especially if its an investment. In theory it’s pretty easy to say, but what happens when you come across that property that just makes you go WOW. It can be hard to stick to the plan and equally easy to get swayed by the selling agents sweet talk, by the shiny stainless steel and those pictures that the great photographer took. Out goes the calculator and before you know it, you’ve purchased something deep down you know isn’t the best fit.
A BA will understand your goals and have an unbiased opinion, if the property doesn’t fully stack up, they will simply move on.
2. Lacking confidence
You may have never purchased property, or you may have a large portfolio, nonetheless if you aren’t in the market daily, negotiating daily, you may lack the confidence necessary to negotiate and speak with selling agents.
The result: the selling agent can smell that lack of confidence and walk right through you. A BA is a professional that does this all day, every day, someone that has only your best interests at heart and won’t let a selling agent get in the way.
Doing it alone can often be a struggle. Sometimes life gets in the way, and you say to yourself ‘it’s ok, I’ll look tomorrow’, ‘I’ll call that agent later’, ‘I’ll research on the weekend.’ Sometimes you just make anything else a priority, so you don’t have to sit down and do the work. I’ve seen it countless times where people say to me ‘I’m looking to buy a property’ and when I run into them 6, 7 months later and ask how it went; the answer, “Oh I just got so busy with life and I never got around to it, but I’m sure ill get to it soon.”
A BA’s job is to find you a property. They work tirelessly to get you that piece of real estate. If they don’t — they don’t get paid, but also and more importantly, most BA’s love what they do and love helping people buy property. A BA will not put your financial future on hold.
4. Lacking knowledge
Maybe you read a book or went to a seminar about property, and in theory you know all the steps to purchase property. However, when it’s crunch time and it’s your hard-earned money on the line, it’s a different ball game. When you are doing it yourself, you may be confused by all the information, you may not have enough information, you may just be lacking knowledge of what to buy, where to buy, when to buy.
BA’s do this all the time; they are experts in this field and often have their own investments and properties. BA’s have access to an incredible array of data and possess the knowledge to ensure you get the best results.
5. Unsure of the process
You have found a property, now what? What offer do you put in? How will you understand the building and pest report? You got through all that and you’ve purchased a property, now how do you find a great property manager to ensure your investment is taken care off?
A BA will aid you in every step of they way, organising all pre and post-settlement work, linking you with great property managers, ensuring that once the property is purchased, it is still taken care off. A buyer’s agent can help you work through your options before you start handing over money in repayments and they can also suggest reputable partners and contacts in the industry once you’re ready to take your next steps.
Ok, ok I’m convinced; a BA is clearly going to help me get a great property, but how do I know if they are a good BA?
Here are some easy quick questions you can ask a BA before engaging them to ensure they are the best to help you!
1. Are you a fully licensed agent?
Be careful of hiring a BA that doesn’t hold a valid license. There a lot of people out there that claim to be BA but are really selling agents working for developers or other selling companies.
2. Are you a dedicated BA?
There are some agencies that have a sales channel as well as a buying channel. Unless they are solely committed to the buying side, they will not fully dedicate their time on you. The other worry is that they purchase a property for you that is also on their sales list. Note: Not all agencies that have both a sales section and buying section will do this, however, I believe it’s best to consult a dedicated BA as you know they only have your interest at heart and nothing else.
3. How do you get paid?
This is a great question to separate true BA’s from spruikers and other pretenders. A true dedicated BA will get paid from the buyer. They typically charge a % or a fee for their service, just like any other professional in any other industry. Be wary of BA’s claiming to work for you for free, often they are being paid heavily by developers or agents to buy their products only. If a BA is being paid by a developer or agent, they simply cannot have your best interests at heart as their choices are limited to what the developer is offering.
First Brick Property Buyers Agency
At First Brick Property Buyers Agency, we aim to support people in generating wealth through property. We believe that every Australian has the opportunity to generate wealth through real estate and we aspire to help you do it!
So, whether it is your first investment property, your dream home you are looking to move into, or you have a portfolio already and are looking to add another property to it, maybe it is time to engage a BA, and First Brick is here to help. Get in touch for your FREE, NO OBLIGATION consultation, and start generating wealth through property TODAY!
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