What To Ask A Property Selling Agent And What To Keep Quiet About
Unless you procure the services of a buyer’s agent, the agent involved in your property transaction is always a seller’s agent. In being so, he is entitled to act in the best interests of the property seller. Once you get this fact into your system, you will be shrewder about the questions you ask the seller’s agent and the way you ask them.
Let me take you through the case of a development property. If you have got your eyes set on such a property, it is wiser not to establish your motive in front of the agent. For instance, do not ask him something like- what should I develop this property into?
I say this with experience. Sometimes, a seller or his agent does not themselves know that their property has got development potential. In such cases, framing the kind of question discussed above may have them raise prices on you.
Profitability of the project
While this was a question you will do good not to ask, there are a few you must ask. As an example, you need to know the kind of revenue a given property is likely to produce. You must as well learn whether a project in question is a medium or a high density dwelling. It will give you an idea of the kind of money you need to put into the development. Usually, when we talk medium-density, we talk 30-40 dwellings per hectare.
What is the reason for sale?
Broadening our arc to all kinds of properties, it is important to address the key aspects first. These may help you in negotiating better. As a first, you should ask the agent the purpose for the sale- why is the seller motivated to sell? This will give you a clear picture of his level of despair.
There are times when the vendor has already bought a property elsewhere and is planning to pay for the contract with the proceeds of your prospective purchase. Naturally, such sellers are more than willing to negotiate on prices.
You must also ask the property selling agent how long the property has been on the market. At the moment, Sydney is witnessing very low time-on-market and if you have a seller who has got his property lined up for long, he surely will be ready to negotiate. The flop-side is that such properties almost always have certain bottlenecks.
Obstacles on the way
For all you know, the property in question might be encroaching on a neighbour’s property, it might have an easement, it might be falling in restricted development zones, it might not have due council approvals, it might be suffering from reverses of close-by constructions (a highway or a metro project), among other things.
Do not forget to ask the property selling agent what is the running price for similar properties in the neighbourhood. Do not talk about the comparable sales report. Let him guess if you know about it. Keep it as a backup to learn if the agent gave you a correct estimate.
To reiterate, the seller’s agent is called so because he represents the vendor’s interests. It is your job to get the facts out of his mouth.
If you are looking to buy a property, it will be in your best interest to hire a buyer’s agent. I can gladly assist you in your investment venture.