If you are considering buying your first investment property, the process probably seems daunting. There is a lot of money involved, many factors to consider, and plenty of paperwork to be done. And, while there is no shortage of “expert advice” available, it can be hard to know who to trust.
Even if you are an experienced investor, identifying good opportunities still takes a lot of effort. If you are unable to devote time to this, it can be extremely difficult to grow your portfolio. You also run the risk of making rash decisions and cutting corners on your research.
This is where a good buyers agent can really help. As experts in the property market, a buyers agent can help you identify the best investment opportunities. They can also guide you through the investment process, managing most of the steps for you.
Here we look at what a buyers agent does and how they can help you on your property investment journey.
Deciding When and Where to Buy
One of a buyers agent’s most valuable assets is their in-depth knowledge of the property market. They should be across the latest market moves and have a good grasp on the hottest areas (including which will stay that way). They should also know where the market is in its cycle and what investment decisions are best for that time.
Based on this, a good buyers agent will help you refine your search criteria. This often means looking at areas and property types you had not previously considered. This is one of the biggest benefits they provide, bringing new and different opportunities to your attention.
Importantly, as part of this, a buyers agent will take into account your financial situation and goals. They will spend some time speaking to you about your plans and what you want to achieve from your investments. They will then base their advice on that, recommending areas that provide a suitable mix of growth potential and rental yield.
Picking the Perfect Property
In addition to helping refine your search criteria, a buyers agent will identify specific properties that suit your goals.
As part of this, they will inspect the property on your behalf to make sure it ticks all the boxes. As experienced property professionals, they will know what to look for and be able to spot any potential issues. They should also be able to identify any additional financial outlay required (e.g. renovations) or benefits available (e.g. depreciation).
This is particularly good for those that do not have the time to arrange and attend multiple inspections. In fact, many experienced investors use buyers agents for exactly this purpose. Being able to have an expert do the inspections for them can save a lot of time.
In addition, a buyers agent will help make sure you do all of your due diligence. They will arrange all the necessary pre-purchase checks, like building and pest inspections, and help you understand these reports. They should also provide a rent estimate and information on the local rental market (e.g.vacancy rates).
Negotiating the Purchase
Most investors will tell you that actually purchasing the property is often the hardest part. This is particularly true if there are multiple interested parties, or the property goes to auction. This sense of competition can heighten the emotion involved and often leads to overspending.
However, when you use a buyers agent, they can act on your behalf through the sales process. As your impartial representative, they will help to minimise the emotion and make sure the numbers stack up. They can also help make the tough call to walk away if the right deal cannot be struck.
As real estate professionals, buyers agents understand the intricacies of the property sale process. They should also be aware of the techniques sales agents use to push up the final price. As such, they can often secure a better deal than you would be able to get on your own.
Developing Your Long-Term Investment Strategy
While some buyers agents specialise in securing individual properties, the best ones take a much longer-term view. They understand that most people get into property investment to build their wealth and secure their financial future. They also know that this cannot be achieved through a single investment property.
The majority of the most successful buyers agents like Search Party Property, who we know quite well, are also property investors themselves. As such, they have real personal experience in the ups and downs of the process. They are also acutely aware of the importance of having a strategy for sustained, long-term growth.
As such, a good buyers advocate will take the time to help you develop your investment strategy. This will take into account your current finances and future plans and should provide a structure for all of your investment decisions. It should also help keep you focused on your goals and provide the motivation you need to keep making progress.
Is Using a Buyers Agent Worth the Cost?
While there are many benefits to using a buyers agent, it is possible to successfully invest in property without one. Also, obviously, the services of a buyers agent come at a cost. As such, it is reasonable to question whether the expert advice is worth the added expense.
If you are to look at the financials alone, using a buyers agent may not seem worthwhile. While they should be able to help secure you a better deal, any savings are usually negated by their fees. However, when you take into account the quality of investment and the time savings, it is a different story.
Using a buyers agent can be particularly beneficial if you are new to property investment. Not only will they guide you through the process, they can help you understand the basics of investment. They can also help you develop your knowledge of the market, equipping you to make better decisions in the future.
Importantly, you should look for a buyers agent that specialises in investment properties. Some buyers agents mostly work with people who are looking for homes for themselves. This is a very different experience to looking for investments, where the number matter much more than emotions.
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