House Purchase via Real Estate Agent and Offers

Ash-Say on 03/08/2015 - 07:33

I went to see a townhouse in Sydney Inner West on Saturday which was advertised for Offers above $475,000 however I made an offer of $510,000. After few hours, the agent rang me and advised that someone put a high offer. They advised that they cannot disclose the amount however it was in the range $550,000 and asked me if I can go higher. I was unable to pay such a high amount for that townhouse so I refused.

I am the first home purchaser so be polite with me while answering the following questions. Thank you in advance for your advice!!!

1) How to check if the agent is not bluffing by quoting they have received higher offers in order to receive high offer from me?
2) The property prices in Sydney look insane so how much you should offer above the advertised price to secure a property?
3) Will an agent always ring you to advise the outcome of your offer?

Home & Garden

Comments

      • snook on 05/08/2015 - 11:21
        +1

        the cheque is made out to the agent and just says it is a serious offer. No one steals your money. It would only be banked if the offer was accepted.

        The agent is kind of like a escrow service and they hold money between the parties.

  • JimB on 04/08/2015 - 20:12
    +2

    It really depends on the market.

    In all but the worst suburbs of Melbourne or Sydney, it's a minimum of 10% over $X advertised.

    They are usually advertised well below the real price to attract buyers. To see what the real price, check out recent comparable sales.

    If it's sitting on the market for over 30 days, then perhaps you can offer below asking price.

    In other states, feel free to offer below asking price.

    Anyone not from Melbourne or Sydney cannot comprehen how hot the market is.

    Remember, the agent is working for the Vendor, don't forget that.

    I recently paid about $40k more than I wanted to, but I really wanted to live in that location. Unless the market crashes I'm sure in 5 years time the extra $40k will be insignificant.

  • maxall on 04/08/2015 - 21:03

    off the topic, does anyone know what is difference between townhouse and split level of unit with garden? Does the water bill is different only? thanks in advance.

    • SlickMick on 13/08/2015 - 08:34

      Units have a body corporate, town houses may not. We had a townhouse in Adelaide that shared a wall, but didn't have a body corporate.

  • nikey2k27 on 04/08/2015 - 21:49

    Mate i wait it out right now back are pulling back loans for investor. i wait and see at this point i feel market about leave out or even fall if china fall apart like will one day. china buyer are used house as bank to store there money if china fall part they want that money fast. they drop market to do that.

    • cannedhams on 05/08/2015 - 10:47
      +2

      Agree. This is an interesting thread.

      I've had a few settlements lately where I've been asked to draw one cheque for the settlement proceeds (to the Bank). This usually indicates that the seller is underwater, but they've applied for hardship with the bank and the bank has at least allowed them to sell the property rather than enter into possession themselves.

      This doesnt count as a default, or a mortgage in arrears. I would be interested in seeing how many credit facilities fall into this category, where the seller is still making some sort of payments but they need to sell the property fairly urgently or they'll go arse up.

  • KaTst3R on 05/08/2015 - 01:51
    +1

    As a general rule, whatever price they advertise for, you add at least another $100k and that is the actual price the owners wanna sell for.

    The low advertised price is also to attract as many people as possible hoping that one crazy foreigner (you know which country) who hasn't done much homework will overpay for the property.. Doesnt happen often but you will see those once a while…

    • SlickMick on 13/08/2015 - 08:39

      wow I wouldn't be buying in this market. I've never understood a "from" in a house price. If that's the lowest they'll accept, then that's the max I'll offer.
      I've never paid asking price - that always used to be the seller's dream price and the ceiling for negotiations.
      I guess I've only bought in a buyer's market.

  • centrelink on 05/08/2015 - 02:34

    Don't ever bid on a house where the agents are BARRY PLANT!! They have the worst silent auction system ever designed to screw potential buyers at maxmimum potential.

  • DarkOz on 05/08/2015 - 07:01

    After the unit is sold you can check on the sold price to see if it's higher than what the agent had told you. If the sold price is lower or the unit is not sold you can report him.

  • garetz on 05/08/2015 - 08:15
    +8

    Everything that comes out of a real estate agents mouth is a lie, they first lie to the vender, telling them the place they are selling is worth more than it actually is so they get the business, then they lie to potential buyers, that there are other bids out there that are higher than yours. The whole system is a scam.

    They always do what is best for them, if the property is deemed hard to sell, they will try to lower the expectations of the seller, if the market is hot they will try to inrease the offers from buyers. Real estate agents are scum of the earth, almost as bad as lawyers, so never trust a word they say.

    • carwashhair on 05/08/2015 - 08:56
      +6

      Real estate agents are scum of the earth
      Real estate agents are scum of the earth
      Real estate agents are scum of the earth
      Real estate agents are scum of the earth

  • c0balt on 05/08/2015 - 09:39

    I can't believe I am the first to mention under quoting in this thread. It's the way the game works now. Advertise low to get in as many offers as possible.

    I put an offer in for $510 on a place that was advertised as $450+ offers. After the agents knocked back mutiple offers from multiple people, the apartment ended up going to $600 at auction when they put to to auction 4 months after I put my offer in.

    It's a sellers market, particularly in Melbourne and even more so in Sydney. It's what any of you would request your agent do if you were selling your place to maximise your profit. It's unsavoury, but welcome to the real world.

    All those bagging real estate agents, you do realise that they are acting under instruction from the vendor - correct?

    • Turd on 05/08/2015 - 09:55
      -1

      Yeap, but often mum&dad sellers do not know shit and just say to the agents do your best. or the agents will go, I think I can get more out of these people, obviously for their own benifit due to the 3% commision they make, and selers will be like sure.. I dont care do what you like, just sell it.

      • c0balt on 05/08/2015 - 10:08
        +1

        Their benefit is the vendor's benefit and it's also the state revenue office's benefit.

        Of course they are trying to make money, what business doesn't? In this case they only make more profit by making other people profit also.

    • snook on 05/08/2015 - 11:29

      only mentioned by actual name.

      I think everyone has moved on from that point because agents have already spent a lot of time in the media about it. The market is so hot that it doesn't matter what they quote, it is selling above. At some point in time under quoting might have been an issue. Today, especially in Sydney, no one has any knowledge of the final price because there are more buyers than stock.

      410 Marrickville Road. Last Sold $1,300,000 in Feb 2012(Auction) I spoke to an agent about this later. He said they thought 1800 tops covered a 30% increase from 2012 but no. Sold $2,850,000 in 23 May 2015(Auction). A 119% increase in 3 years! Pretty amazing yeah? What people can't see though is that previously Council had said no to multi unit development on the site. Now they were saying yes.

  • congo on 05/08/2015 - 10:21

    This is like a Dutch (private) auction.
    It sux for the buyer but great for the seller and agents.

  • SnakeCasablanca on 05/08/2015 - 11:28
    +4

    Welcome to "Who's Real Estate Market Opinion is it Anyway". Where the personal experiences and opinions are outright facts, there is no gray area, and everyone is an economist. Hahaha.

  • Kempe on 05/08/2015 - 14:46

    SA is much more stable.

    If the asking price is 450k to 475k you will probably get it for $440k

    Of course there are some people who do not know this and offer $470k or more to secure the home

    • SlickMick on 13/08/2015 - 08:44

      That's the way it used to be in Qld too - between 1999 and 2008 when I bought. I always thought the range was dumb. hmmm let me see… I'll take the lowest please, well actually, I'll need a discount on that.

  • ryan on 05/08/2015 - 16:19

    Unfortunately there is no way you can tell if the agent is bluffing. I know some people having the same experience. They backed-out when the agent asked them to make higher offer. A week later, they found that the property was sold at the price the agent quoted. Would they have got it if they made higher offer? Maybe yes, maybe not. It's a gamble.

    What you can do is do alot of research on what the average % increase from price guide as a rule of thumb. And always consider location, location, location. A property close to shops or transport would be higher in demand than in the middle of nowhere.

    Another option is to use a buyer agent. Not sure if they are any good but they should be the one doing all the homework for you. For a fee of course.

    Good luck!

  • RocketSwitch on 05/08/2015 - 20:42

    This is difficult.

    As others have mentioned, especially in Melbourne, they advertise low, generate interest and bang, house goes for $50K to $90K more than advertised.

    Do your research around the area, what you're looking for and keep notes on what's selling and at what price. That tends to give you a better idea of what you should be going for.

  • bocca on 06/08/2015 - 09:19

    Big LOL St Mary's is West!

    Wiki- St Marys is a suburb in western Sydney, in the state of New South Wales Australia

    Inner west generally doesnt go past homebush and houses in the inner west usually cost upwards of 1 Million!

  • S4Sneaky on 06/08/2015 - 09:34
    +1

    Might be a different here in Qld however I have found in my house hunting travels that when we have had to put offers in on a property that we have encountered a "multiple offer form". This is when there are two offers (or more) on the one property.

    We need to put in our best offer and then the other party does likewise. There is no back and forth it is basically which offers the best 'deal'.

    I have found obvious pros and cons with the experience however it has removed the dodgy Real Estate says there is a "higher offer" scenario that you have encountered.

    Is this an Australia wide thing or is it just in Sunny QLD?

  • Donaldhump on 06/08/2015 - 14:37

    i found a acerage property in pimpama gold coast for 590, offered 550, then 560, and then said no… 6 months later sold at auction for 535..

    i was furious…. the real estate agent cost them 25k… and never once called me after the i assume reserve of 560 minimum wasnt met.

    and here is a pearler…

    i found a 3 bed house in robina, for 579, finally agreed price of around 540ish from memory, had contracts signed and went into real estate office to hand them in… and saw the property advertised in the window for 529K…. i have no idea what the story was but i told them, some has ****ed up and lied to me, see u later
    and kindly dropped a note in the owners mailbox telling them that… there excuse was it was an old listing from 2 years ago that never got taken down… **ll ***t

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