Real Estate Advice
What is a buyer’s agent?
You may have heard the term buyer’s agent or seen them at work on popular property shows. But what exactly do they do, how are they different to a real estate agent, and do you need one?
Well, purchasing a property can be an emotional experience. Some people find using a buyer’s agent helps minimise risk by making informed and impartial decisions.
Here, we look at what a buyer’s agent does and how they contribute to the property purchasing process.
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What is the role of a buyer’s agent?
Purchasing the right property involves many different components.
A buyer’s agent, or buyer’s advocate, is a licensed representative who specialises in identifying properties within budget and negotiating the purchase on behalf of the buyer.
Along the way they also liaise with the seller and assist with the logistics of a property purchase. They will evaluate the suitability of available listings and conduct due diligence, providing advice and guidance as required.
A buyer’s agent may also attend auctions on behalf of the buyer, negotiating the process with the buyer’s interests as the priority.
How much does a buyer’s agent cost?
Typically, in Australia a buyer’s agent will charge between 0.9 per cent and 3 per cent of the total purchase price.
As an example, a buyer’s agent charge of 2.5 per cent on a $1 million property will equate to a $25,000 fee.
Other fee structures may be used by buyer’s agents such as fixed fee or tiered. Fixed fees vary depending on the agent and a tiered structure will differ depending on the price bracket of the sales price.
Some buyer’s agents may also ask for a percentage of the fees upfront and some will offer lower fees but there might be additional costs for reports and evaluations.
Buyer’s agent versus selling agent
The difference between a buyer’s agent and a seller’s agent comes down to which party is paying the agent. The buyer’s agent will operate exclusively on behalf of the buyer and is paid by the buyer upon purchase.
A selling agent works on behalf of the vendor and is motivated to achieve a high sales price. A buyer’s agent will consider a wide range of properties whereas a seller’s agent will focus on the advantages of a particular property.
Do I need a buyer’s agent?
Whether or not you choose to work with a buyer’s agent is a personal preference that might be driven by factors such as:
- Specific requirements for the property
- Limited time to house hunt
- The desire to purchase an exclusive property in an exclusive area
- A need for anonymity in the house hunting process
Meanwhile, it’s important to note a good local agent is also available to assist buyers. A great agent will happily take down the details of the type of property you’re searching for and alert you if something along those lines is about to come onto the market or is currently for sale.
In fact, the best agents have a database of buyers and see matching buyers with properties as a key part of their role.
How we can help
If you’re considering buying or selling a property and seeking to understand the current market conditions, why not chat with one of our friendly agents to understand how we can help?
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