If you’ve been thinking about buying a home and you’re ready to take the next step, then you’ll know that it’s one of life’s biggest milestones. And with big milestones come big emotions and even bigger learnings.
To help you navigate the process, having the right advocate can help you move through the home-buying process as smoothly as possible. We’ll take you through everything you need to know.
What does a buyer’s advocate do?
Also known as a buyer’s agent, a buyer’s advocate is a professional in the property industry who specialises in finding and evaluating properties for sale. They can also negotiate or bid at auctions on your behalf.
A buyer’s advocate has your best interests in mind, and will protect you from common pitfalls by establishing a property’s value, negotiating the best outcome and completing the due diligence on a property for your protection.
A buyer’s advocate will work closely with you to understand the ins and outs of what you are looking to achieve. This will enable them to provide you with insights, intel and services that will ensure you find the right home for your needs.
Typically, buyer’s advocates work with the time poor, overseas and interstate buyers. But they can also be great to work with if you’re looking to buy a property in an unfamiliar area.
What about real estate advocates? Aren’t they the same thing?
Not quite. Basically, a real estate advocate works with the vendor (seller) of a property, while a buyer’s advocate works with the buyer of a property. Real estate agents work with the goal of helping a vendor to sell their property for the highest price possible. Buyer’s advocates, on the other hand, work for buyers with the aim of helping them to find a great property for a great price.
How much does it cost to work with a buyer’s advocate?
While there are no fixed costs, some advocates charge a fee, while others charge a percentage that’s based on the purchase price. Advocate fees are generally around 1 to 3 percent.
So if you choose to engage an advocate and buy a property for $500,000, then your advocate could charge you a fee anywhere between $5,000 to $15,000.
Some advocates may also charge a retainer fee when you first engage them.
“Beware of a buyer’s advocate with fees that are too good to be true. Although the fees for an experienced and knowledgeable buyer’s advocate might seem expensive, their expertise will save you the amount you pay in fees 10 times over”.Tonya Davidson, Davidson Advocates
What makes a great buyer’s advocate?
Apart from their years of proven experience in the property industry, the buying process, and auction bidding, there are a few things you might want to consider.
- Meaningful knowledge
They will not only understand how the property industry works, but they will also have exclusive intel regarding the areas in which you’re interested in buying and the latest properties on the market. A buyer’s advocate will be able to provide you with meaningful insights about capital growth, infrastructure, local laws/regulations and the housing market in general. They will also be skilled negotiators and bidders.
- Industry relationships
Their relationships with industry experts can also go a long way. Quite often, buyer’s advocates have access to properties that aren’t advertised on the market. So if you’re tired of trawling through home buying websites, or simply don’t have the time, then an advocate could be a great resource for you. Before engaging a buyer’s advocate, make sure that they can demonstrate their industry relationships – don’t just take their word for it.
- Ability to estimate long term value
Although no one can predict the exact capital growth or rental yield that a property will experience over time, a buyer’s advocate can provide you with insights by analysing data, past growth, yield infrastructure development and school proximity. If an advocate tells you that they can predict capital growth, take this as a red flag.
- Transparency & commitment to great service
Some buyer’s advocates provide onboarding offers like ‘no onboarding fee’ to encourage clients to sign up. Although this might seem like an enticing offer, it is also a sign that the advocate doesn’t value their time, has a lack of negotiating skills, or aims to buy the market not through skill and expertise but by offering their services for free. Offers like these are usually provided by inexperienced buyer’s advocates. At Loanscope, our highly experienced advocates go the extra mile for our clients. We don’t need onboarding gimmicks to acquire new clients, because our high level of service and commitment speaks for itself.
How do I know if an advocate will suit me?
Choosing a buyer’s advocate, at its core, is choosing a professional relationship. And all professional relationships need communication, trust, and empathy. There are a few steps to take when choosing the right advocate for you and your needs.
- Do your research
Do some research and look for advocates who have worked with buyers in the location you’d like to buy in. We recommend that you take a look at their client track record, their career highlights, how long they have been in the business, their online reviews, and the quality of their website and its content. Also, make sure the advocate is willing to work within your budget.
- Communicate clearly and respectfully
Set expectations and communicate your preferences from the beginning. As it is with any relationship, be clear and direct about your needs. This means sharing your preferred locations, price range, style, size and anything else that will help your advocate refine their search. Remember, the clearer you are, the better your chances of finding the right match.
This includes asking questions, even if it’s as simple as asking to be updated every week or every other day. Let them know your preferred communication method so they know not to email you when you’ve said you’d prefer phone calls, or vice versa.
- Go to open houses
While your advocate can help you schedule viewings and come with you to open houses, it’s still important for you to go to as many viewings as possible so that you can get a clearer sense of what you want.
What should I ask a buyer’s advocate?
Here are a few questions you can ask in your first meeting:
- How long have you been a buyer’s advocate?
- What are your qualifications?
- Which local areas are you most knowledgeable about?
- Do you own any properties?
- Can you tell me about your own search and buy process?
- Do you have access to unadvertised properties?
- Do you get any commission/income from the properties you recommend?
- How many clients do you average?
- What are your values, and how will they benefit me?
- Who will handle the file?
- What is a realistic outcome that I can expect from working with you?
What can I do if I’m not satisfied with a particular advocate?
Honesty is always the best policy! As long as you’re communicating with them consistently from the beginning, you will build trust and rapport. But sometimes things don’t always go as planned.
If you find yourself getting concerned about your advocate, don’t be afraid to share your issues about the property search.
If the worst happens and you don’t want to engage their services any longer, you may need to find another advocate. Read through the advocate’s contract to ensure you’re not breaking any part of the agreement if you wish to disengage.
What else do I need to be aware of?
Overall, it’s important to listen to your advocate’s advice, because at the end of the day, they’re the industry expert, and it’s their job to help you navigate the property-buying process and make sure you’re getting the best deal for your needs and wants.
With that in mind, you can also check weekly auction results in the area you’d like to buy in to give you a better idea of what to expect. Head to Consumer Affairs Victoria for more information.
To learn more about buying property or securing home loans, visit Loanscape Property Loans.
Disclaimer: The content of this article is general in nature and is presented for informative purposes. It is not intended to constitute tax or financial advice, whether general or personal nor is it intended to imply any recommendation or opinion about a financial product. It does not take into consideration your personal situation and may not be relevant to circumstances. Before taking any action, consider your own particular circumstances and seek professional advice. This content is protected by copyright laws and various other intellectual property laws. It is not to be modified, reproduced or republished without prior written consent.