Buyers Beware

Will the buyers agent become more and more prevalent? Buyers are at a distinct disadvantage in the negotiation stakes. The agent is acting first for the seller and secondly for himself.

The local agent gets to know what buyers are out there. They see them at the inspections, at auctions, and they learn a great deal from these interactions. The buyer may have been the underbidder. He knows the price range the buyer is looking at and roughly what the maximum that buyer can pay. And it is this information the agent uses "against you".

Whereas the buyer doesn't know or meet the vendor or what is motivating the vendor to sell.

domain.com.au published this advice: Real-estate agent Peter Dempsey, director of The Dempsey Agency

"Play your cards close to your chest. The agent is not working on your behalf but should be acting in the seller's best interests, so you don't want to give them too much information. Otherwise it could work against you in the negotiation process. The agent may ask you if you have your finance arranged. Confirm you have but don't tell the agent about your buying ability. Certainly, don't say you can go to $410,000 or borrow up to $450,000. That sort of information should never be revealed. Don't disclose your profession either. Reveal nothing more than scant details so the agent can simply narrow down the purchase for you.

"If the agent offers properties beyond your price range, then you can acknowledge that. You can't keep money out of the equation all of the time. When you are negotiating over the last $20,000, you may say you don't have the ability to go further and your mortgage offer is set at X amount. First-time buyers often allow the real estate agent to control the conversation and negotiation. You have to take that control out of the hands of the agent. This slow market allows buyers to do that."

Or just use a Buyers Agent.