Insider secrets to top home deal
No matter what sort of home you’re selling — or what property you’re looking to buy — real estate expert ANDREW WINTER has these behind-the-scenes insights from three decades in the business to help you get the best deal.
SELLING
1 Never go to auction
An auction is categorically not the best way to sell your home. It can put unnecessary and artificial demands on you as a seller and place you in a precarious and highly stressful “all or nothing” situation.
There is an intense focus on the Sydney and Melbourne auction markets but across the country most properties are not sold this way.
If necessary, an auction campaign can kickstart the sales process, but your home doesn’t then have to go under the hammer.
Exceptions might be where transparency is required such as divorces, deceased estates or foreclosures.
2 The tender sale process is the best option
The beauty of the tender process is it’s good for the buyer and the seller.
There is a due date for offers but it’s not legally binding like an auction and doesn’t scare off buyers that can’t commit to auction conditions.
It offers comfort for buyers in knowing they have put their best offer forward and it has been presented to the seller.
Meanwhile, it offers a flexible sales method for the homeowner – you can determine the settlement period and other particulars – it creates competition and maintains campaign momentum.
3 Understand your home’s value before appraisal
It doesn’t matter what the market conditions are – booming, bust or COVID-19 – you need to sensibly educate yourself on what your house is worth, not what you want for it, before you begin the sales process.
There is a massive difference between the two. Understand why houses in your area similar to yours have sold for more than you can reasonably expect, such as a new kitchen, or less, such as south facing.
4 Search for the quiet achiever agent
There are often many agents you can choose from but the selection is fairly consistent in any market.
There will be the ruthless and high-profile agent who is said to be No 1 and others equally as successful – the quiet achievers.
You have to be fairly strong yourself to go with No 1, who will likely have a system you have to follow.
We all work better with different people and the “sharp” ones don’t suit everyone. As such, the quiet achiever might be best for you.
Search the active agents in your area who are selling homes like yours on realestate.com.au.
Listen to friends at the school gate or the coffee shop. Then make your decision.
5 Understand who your buyers are
Knowing who is most likely to be interested in buying your property can assist you greatly in your sales approach, including photos, the signboard and during open for inspections. Is it first-home buyers, a family or downsizers? Adapt to them.
They want to see a house they can imagine themselves living in.
For example, if yours is a fourbedroom family home, don’t be afraid to leave your teenager’s posters on the wall or your youngster’s Dora the Explorer toys on the shelf.
6 Beware of selling off-market
The best chance of getting a good price for your house is with maximum exposure. Selling “off-market” doesn’t achieve this.
If you are trying to cut costs, saving $10,000 on marketing might mean your home sells for $50,000 less, so, in the end, you are losing out big.
If you want to be discreet or are selling a high-end property only few can afford, off-market might be for you, but for the vast majority of sellers it isn’t.
7 Home styling can make things worse
When selling, it’s vital your home looks its best. But buyers are very aware of styling these days and it has far less impact than it once did.
If you’re selling an investment, it might be better left empty rather than just plonking furniture down that makes the home look strange.
For owner-occupiers, combining styling with what is already there can make it look like a stage.
8 Pull your family or tenants into line
No matter how long you have lived in your house, it needs to look ready for sale.
It has to look clean and tidy to buyers.
If so, they can forgive an old kitchen, but a messy, dirty or cluttered house will reduce appeal to potential buyers.
Pack your kids’ toys away, don’t have your tenants leaving breakfast in the sink or their gym gear under the bed.
Buyers want a house that has been loved and looked after.
9 Always buy and sell in the same market
Whether the market is going up or coming down, it’s always best to aim to buy and sell in the same market no matter the conditions.
If you leave it too long between buying and selling, markets in individual suburbs can change in a matter of months and you can get caught out when values shift.
10 Have a clear Plan B
Whether you decide to sell before you buy, or buy before you sell, you need to have a Plan B in case it doesn’t turn out as you hope.
If you have purchased your new home and can’t sell your old one, or vice versa, you may have to rent one for at least six months before the situation changes so you don’t get into financial trouble.
BUYING
1 Begin with your lender
Whether you’re a first-home buyer, a downsizer, an upsizer or a rightsizer, don’t do anything until your finance is in order with your bank or broker.
These days they want to know everything about how much you’re earning, how much you’re saving, what you’re spending on and what your lifestyle is like. There’s no hiding it anymore.
Once you know how much money you have access to, and what you can afford, then you can start looking.
2 Warm up before you start
Spend six weeks studying the market before you get serious. This gives you time to understand all the relevant factors driving prices.
Visit open homes, talk to agents and attend auctions so you know what is currently going on.
Save your searches on realestate.com.au, subscribe to email lists and listen to feedback.
You need to be comfortable with everything – this is the big deal. This way you will feel more confident when the right home comes along.
3 Have a plan of attack
Get to the open home inspections early so you’re not pressured, rushed or crowded out.
Inspect the property logically. Look around the perimeter, at the gutters, the downpipes, walls, windows, fencing and work your way around each of the rooms. Open the cupboards and look at the ceilings.
Remember, the furniture is irrelevant – the clever buyer takes no notice of that. It won’t look like that when you’re living there.
4 Work on your poker face
Inspections can be awkward. If you like the home, acknowledge your interest but don’t appear too keen.
If you tell the agent you love it, you won’t have much leverage. Make the agent work for it and give yourself the best chance of the best possible price. Be honest: “We like it, however we’re not ready to make an offer” – but don’t trip over yourself to get a contract.
5 Mind your (body) language
Give the agent, the auctioneer and the seller nothing! Keep your gestures, emotions and body language in check at all times during inspections, negotiations and auctions.
Stay calm. Don’t get flustered, frustrated or excited, as it won’t help you buy the home no matter how much you want it.
6 Ignore historical price growth trends
For the most part, price growth trends are irrelevant. Study what has sold for the past six to 12 months in the areas you’re interested in to get a benchmark on prices.
A longer term view can be misleading. Just because prices have grown massively in an area for 10 years, doesn’t mean it will happen again.
7 Stretch no more than 5 per cent
Ensure your bank balance, not your emotions, guide your purchase.
Once you have settled on how much you should pay, including your mortgage, don’t pay more than 5 per cent more. No matter if it is the home you really, really want.
Things can get very uncomfortable if you go further than that.
8 Avoid buying off-market
As an “off-market” buyer you will struggle to get value for money. You might be dealing with a cocky seller who believes, or has been told, that because they’re doing a secret marketing campaign they’ll get a lot of interest.
Off-market sellers are also unlikely to take the first offer, which means there’s little chance for a bargain and the usual competition between buyers will apply.
9 Don’t be scared to open the bidding
Auctions can be intimidating, and no one likes to make the first bid. This can stall the auction completely when no one wants to show their hand first.
But if the opportunity is there, put in a ridiculously low bid and see if anyone follows you. They won’t get an idea on your limit but you might get an idea of theirs. And if the home gets passed in, you’re in the box seat for negotiations with the seller.
10 Consider a buyer’s agent
Most prospective buyers won’t see the need for a buyer’s agent. However, if you’re earning a good income and don’t have the time, or inclination, to look – or you’re not comfortable negotiating – they could be right for you. You’re also paying for their market knowledge but it’s very hard to prove, as many claim, they have saved you money on the price you have paid.