Using BA in a hot market...

Discussion in 'Property Investment - Other' started by arashi87, 14th Jun, 2015.

  1. arashi87

    arashi87 Member

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    To all the BA on Somersoft,

    What are the advantages for using a good BA in a hot market like today where everyone just offer n offer n offer above anyone else ...

    Cheers
    Arashi
     
  2. Rolf Latham

    Rolf Latham Member

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    get in and get the place off the market before that happens.....................

    Timing !

    ta
    rolf
     
  3. BayView

    BayView Member

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    For them or you?

    Spending $5k more than you need to in an already overheated market....?

    Are you buying for investment, or PPoR?
     
  4. arashi87

    arashi87 Member

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    for investors...

    just a generic question regarding pros and cons of using BA in a hot/cold market

    personally i cannot lock in any offers due to others offering above n above n above all time:mad:
     
  5. MsAli

    MsAli www.propertytwins.com.au

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    If you're talking about Sydney, I recall reading from some SS BA's that they too are struggling to compete in this market.
     
  6. arashi87

    arashi87 Member

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    mainly NSW
     
  7. MsAli

    MsAli www.propertytwins.com.au

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    NSW is a big place. But if you're wanting a BA to help in Sydney, sure they can help. But it doesn't mean they won't miss out due to the demand in the market right now.
     
  8. albanga

    albanga Member

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    How wide is your net? If you have an idea of say a 20km radius then I would suggest getting on the front foot and putting together a propery profile and get it in the hands of as many REA's as you can. On a Saturday you could get it to 30+ agents no worries.

    Once a propery gets listed your too late.
     
  9. NPB

    NPB Member

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    It's tough in a hot market as a BA especially when buying for investors as the "fair value" for a property becomes a moving target.

    The main advantage I would say is the off market transactions, amazingly in a hot market some vendors still want to sell off market, we are getting quite a few through in Melb at the moment, not sure if that is happening in Sydney, will find out soon enough when we open our Sydney office later in the year.

    Why don't you call a few Sydney BA's and ask for examples of properties they have bought in the last 2 months and see if those properties at the prices paid would have been worth paying the fee.

    Good luck
     
  10. Jacque

    Jacque Buyers Agent and Bookworm

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  11. beachgurl

    beachgurl Member

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    I just engaged a BA in Brisbane to buy a small development block as its tough to buy up there at the moment. Took about 3 weeks to secure a property.
     
  12. DavidMc

    DavidMc Member

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    The question you REALLY need to ask is WHY would you buy in a hot market?
     
  13. JohnHenry

    JohnHenry Mister

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    Invest in Wollongong, NSW 2500

    Yes, same thing happens to me here in Sydney.
    I've been offering according to what RPData suburbs statistics median price +$5k and up to $10k, but somehow there will always be someone woh crazily enough to out bid me in the auction for more than $50k above the reserve price :mad:

    Therefore, just like some of the SS experts told me, hold your horses investing in Sydney, better to invest somewhere else outside Sydney NSW or go to Regional area such as Wollongong area.

    This is based on credible source: http://www.smartpropertyinvestment.com.au/opinion/14287-3-regions-with-potential-for-growth

    Hope that helps.
     
  14. Jacque

    Jacque Buyers Agent and Bookworm

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    What do you mean JH? Are you offering an extra $5-10K on top of the current median house/unit price for every property you find for sale in a particular suburb? I'm lost......how are you ascertaining fair price?


    $50K above reserve isn't uncommon right now and in fact, may well be a solid buy compared to other recent sales, many of which have sold for many hundreds of thousands above their reserves. Take these for example:

    http://www.realestate.com.au/property-house-nsw-baulkham+hills-119651007
    sold $430K over reserve

    http://www.dailytelegraph.com.au/re...ydney-remain-hot/story-fni0cly6-1227262369554
    ranging up to $1.1m over reserve

    Don't forget that reserves are set by vendors and just because something sells above (or below) doesn't make it a "crazy" (or great) buy necessarily. Assessment of fair value in the current marketplace for the particular property is what makes the difference.


    Credible source?! I think Charles Tarbey has as about as much chance of forecasting and getting it "right" than all the other "experts" out there, SS members included :D

    Good luck with your purchasing.
     
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  15. TobyRichardson

    TobyRichardson Member

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    One of the definite advantages in a hot market is that a BA will often get sent investment/development sites before they hit the market, so that the sales agent can save on marketing costs.

    This is usually because in a really hot market, the sales rep will often have to pay for marketing themselves due to the competition in the market at that time.
     
  16. MTR

    MTR Bling Bling

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    That was probably me.:) Not dumping on BA service, just calling a spade a shovel.

    In a rising market BA also struggle to find deals, not saying they wont and they don't.

    However what about all the other clients, don't you think some would actually want what you want?? How does that work?? Someone has to miss out, hope its not you. In a rising market it can move so quickly unless you can jump in very asap you are wasting valuable time.

    For me the best way to source a property in a rising market is to network with re agents and as many as you can. The best deals I have sourced have always been because I am either working with a lazy re agent or out of area agent who does not have a handle on the area/prices and wants to sell, and not be bothered with home opens, that's how I secured my latest deal in a very hot market and well under market value.

    Keep working it and keep networking, you do this enough something good is bound to happen:)
     
  17. MsAli

    MsAli www.propertytwins.com.au

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    Hi Marisa - you would have :). Confirmed by Propertunity here that it is a challenge: http://somersoft.com/forums/showpost.php?p=1318119&postcount=6

    "It is hard enough for us as BAs to buy in the present market, and that's all we do all day for a job. "

    Totally agree. It's about being able to form rapport and connection with the agent. If they trust you, know you're not a tyre kicker, you are more likely to get the deal than someone who hasn't built trust. One of our purchases in the rising Sydney market - we didn't know the agent (but I'm a serial real estate agent phone number saver)...luck was with us that the agent took our call (and had 12 other missed calls by the time we signed the contract 4 hrs later). Further, our offer wasn't even the highest!! But we managed to build the rapport and connection with the agent in the 5 minutes we saw the home and the other 20 we spent signing the contract. We came prepared, with all company documents, cheque book...ready to withdraw 0.25% deposit from the bank. Told him a bit about ourselves. He told the vendors that he would pick our offer over the other one as we know what we're doing (the other buyer apparently was umming and ahing about finance approvals). We paid $6,550 more than the asking price and $3,450 less than the other offer. We paid ~30k below market value (not sure how we pulled that off! :D). And now it's worth roughly 50% more than what we paid for less than 2 years ago.

    Can't wait till it's a buyers market :D

    P.S. Let me make note that a day or two before this purchase I was on phone with you about jumping in a rising market....Thanks for the great advice. I had thought the horse had already bolted then!
     
    Last edited: 15th Jun, 2015
  18. wombat777

    wombat777 Member

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  19. arashi87

    arashi87 Member

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    Great feedbacks fellow SS!

    Ive learnt a lot from you guys!

    Yes i completely agree WHY buy in a heated market ... But i am looking outside of Sydney, and yea i know theyre already hot as well. But i do believe at any stage of the property cycle there will be something that worth the bucks! Worth to invest! :rolleyes:
     
  20. JohnHenry

    JohnHenry Mister

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    Many thanks for the suggestion and sharing Jacques and Wombat.
    It seems yes, you are right, even though the article is published in a RE website, it must be taken with a grain of salt.

    Hence I'm asking or discussing it here in SS forum :D