There’s a saying in the property market which goes something along the lines of the ‘money is either made or lost in the purchase of a property’ which I suppose is why the allure of buying property off market seems to be the go to for trying to snatch up a bargain.
Like everything in life there’s polarity attached. The old pros and con list.
We all know the pros, you see them splashed over every ‘winning real estate strategy’, buy under market value, zero competition to deal with, can save $$ in marketing and so on.
Then there’s the other side to buying off market. The less cool, money losing, weird uncle side that we don’t like to talk about as much.
Fortunately, we’ve had the opportunity to go down this exact path and have put together a few points in the hope you have the full picture if and when you are put in this situation, lets even it up a bit.
- What is it really worth? First thing to be aware of is asking price. In a usual setup, the real estate would have walked through the property and compared the properties to a few recent sales in the area and given an approximate market value, typically a tad higher to spark the interest in the seller to make them want to sign up. That number is now what the seller wants even if deep down inside they know it’s inaccurate. The only real way to know a properties actual value to the market in that specific time is to list it. If people are banging down the doors throwing offers at the agent, the price is good and matches the market. If no one shows up or calls, then you know the price is too high. When buying off market, unless you know your numbers extremely well it’s hard to tell what it’s worth which means you don’t really know if you’ve bagged a bargain or not until after the fact.
- Terms, what terms? When buying off market you won’t be getting much generosity when it comes to terms, the seller typically isn’t wanting extended finance, building and pest checks or delayed settlements. For some this is not an issue for others its massive. If you are able to go in well prepared and expecting the worst, then anything you gain from there is a win.
- Emotion is everything. When you are buying off market there is usually a sense of urgency because the agent typically wants the house gone asap and isn’t interested in giving you time to weigh up options, which will come out in the form of “we will need an answer because we have 5 other groups wanting to come through”. Whether he’s telling the truth or not is irrelevant because the pressure of it all feels very real and then the fomo kicks in so you’re now in an uphill battle with yourself. Good luck
Am I saying don’t buy off market, hell no! there’s been serious money and equity made in this approach, all I am saying is be prepared, know your numbers, the market you are buying in and spend time fostering a relationship with a decent real estate agent you trust can help eliminate a lot of the pitfalls that come with buying a property off and on market.
The flip side to that is if you are buying a property you absolutely love before anyone else has had the opportunity to see it then who cares if you’ve overpaid, it’s yours and long term, the money won’t matter when you have a truck load of memories attached to it.
This blog has been provided by the wonderful team over at Conker Concreting. If you or someone you know if looking for an A grade concreting team they are ready to take your call on 1300 CONKER (266537) or email them at [email protected]