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

  • firedragon on 03/08/2015 - 08:30
    +20

    1. The agent is often lying. But all you can really do is walk away if you best offer isn't accepted, or pay more.

    2. You should pay as much as you think the property is worth, to YOU. It's pretty nuts out there…I feel that the advertised price is inaccurate.

    3. Nope, not always.

    Good luck. The inner west is crazy though.

    • Ash-Say on 03/08/2015 - 09:10
      +1

      Is there any regulation available by which you can ask for a written evidence of offers made by other parties to ensure that the agent is not bluffing by asking you to make high offers?

      • ProjectZero on 03/08/2015 - 10:11
        +2

        The offers are always anonymous to everyone but the parties involved (seller, agent and buyer). This is not public knowledge until after the sale has been confirmed if I remember correctly. You just have to trust the agent I'm afraid.

        As per firedragon's comment, just walk away if you offered your best. If the agent was truly bluffing, he'll find a way to come back to ask in another way if he and the sellers get desperate enough (although not very likely in the current market)

      • edgar28 on 04/08/2015 - 13:28
        +11

        I experienced like a big "bluff"

        I offered 310k, agent came back saying you need minimum 320k as someone offered higher then
        I agreed on 320k ……. same night agent call and said min 330k now I'm outbid again ……

        then I was like ok……. second day agent call saying very unfortunate that onwer only willing to see min 350k

        then i was like too bad……. not going to entertain anymore (kind of feel it's a BS)

        two days later, agent called and ask why not put in 430k in writing, my answer is no, and that night the agent ask whether I want to put in offer for 410k ….. my asnwer to the agent was not dealing with you anymore.

        • edgar28 on 04/08/2015 - 17:18
          +12

          opps
          just saw my last message

          it should be

          two days later, agent called and ask why not put in 330k in writing, my answer is no, and that night the agent ask whether I want to put in offer for 310k ….. my asnwer to the agent was not dealing with you anymore.

        • snook on 05/08/2015 - 14:31
          +3

          @edgar28: yeah but, you could have got what you wanted for what you wanted to pay. You could have offered less than the 310.

          They are all ars*hats it is true, but when they fall down you should still take advantage.

        • edgar28 on 05/08/2015 - 16:32

          @snook:

          that is just the beginning, what if they try to screw u in between? someone being dishonest and cunning might try to hide certain things from you?

          damage roof? bride the inspector to give u good building or terminate inspection report? just not worth it anymore.

          bare in mind termite inspection has no warranty. they claim termite can come within a month to deal big damage

        • snook on 06/08/2015 - 11:15
          +1

          @edgar28: Agents know nothing about the condition of the house and even if they did, it's irrelevant, they don't care because it's still going to sell.

          I don't get pest and building reports. Those guys in my mind are worse than agents. They KNOW what they are looking at and choose to be evasive. $400 for someone to tell me what I have already seen with my own eyes? $400 to tell me that there may be something more but they couldn't access the area and so can't confirm? No thanks, I'll keep my $400 x however many houses.

          Guy from my work had a building report - couple of months later the attached electrical cables pulled the wall into his front yard. The building inspection people said haha, we couldn't have reasonably seen anything like that.

          In general, I find the build quality of houses from the 80's on, to be of poor quality. I once did advertising for a project housing company. I know they use the cheapest materials possible. They only have to last max 7 years. On top of this, most of these new housing estates in the west of Sydney are on slabs in low lying, flood prone, ex farming land with salinity problems. This is only going to get worse. Those houses aren't going to be there in 100 years. That salt is going to eat those slabs right up. See bricks with white stuff on them? Salt. Who is talking about this? No one, but they'll last 7 years and that's all they need.

          I know a builder who built 6 townhouses. He was shoddy. He kept them and rented them out for 7 years until the warranty expired. Then he sold the problems he created onto others.

          Just a couple of examples but you have a lot more to worry about than agents. Agents are just greedy dicks collecting money and that's all they can see. I find it best not to be desperate and not care whether you get it or not. The unseen condition of it, is the last thing you have any control over.

          Also, in the big picture 3% of each 50,000 is $1,500. When you're looking at the turnover in Sydney, no one is gonna go all James Bond for $1,500.

          Here's more perspective. A new estate with 120 lots (+ more they aren't selling right now) costs 3.5m to develop. You work out how much profit they're making.

        • edgar28 on 06/08/2015 - 17:14

          @snook:

          Thanks for your insight experiences.

      • [Deactivated] on 04/08/2015 - 13:51
        +15

        Story 1: Asking price was 495+
        I looked at the sale history of the area and decided to offer 460. It was rejected, I increased another 5K.
        Rejected but on the ground that someone else offered a much higher price. I said the maximum amount that I would pay was 470. The agent disappeared. The house was sold few days after that at 485.
        He wasn't bluffing but used my offer to pressure the other buyer to increase their offer.

        Story 2: asking price was 625+
        First offer 590. The agent called back in 15 minutes saying that there was a much higher offer and suggested that we should look at 620 range. We increased the offer by another 5K, made it 595. Didn't hear anything for a while then one day, the agent called and said that the owner was happy with 590 if we were still interested in the house. He totally forgot about the 595 offer :)

        We were quite confident with our offers because we did quite a bit of searching and investigating before placing an offer. It is important to set how much you think the property is worth then set the offer accordingly.

        Don't let yourself attached emotionally to the house. There is always a better one waiting for you.

        I'm in Canberra though. Sydney is way more crazy and I'm not sure if my experience would still be applicable.

        • toristo on 04/08/2015 - 19:37
          +15

          It's not applicable… In Sydney we subscribed to the "shut up and take my money" principle where you ask the bank how much you can borrow, take all of it, then sell your first born child, car, pimp yourself and then throw it at the first dump you can find and cry hoping the current owner feels sorry enough for you to take your offer.

          Seriously, Sydney is nuts. Glad you're having a better time in Canberra. Good work for sticking to your guns.

          I went to an auction for a cruddy, run of the mill 1960s red brick, 2br apartment, 1 bath, all drab, dime a dozen. It went $100k over the listing price, and easily $80k over what is was worth compared to other places nearby and there was a husband holding his wifes arms down to stop her bidding because she was so desperate to get the place. Crazy crazy stuff. If it was a cute little cottage, perfect to raise your family in, emotional blah blah, sure, but this was anything but.

      • TheBird on 06/08/2015 - 07:55
        +1

        No regulations.

        Something to consider. It could be a legit offer though it's more than likely it's a "fake" offer trying to get you to bid against yourself.

        I put in an offer on some real estate. A couple of hours later I get a call, "the other party also wants the property, I suggest raising your offer" "Leave it as is".

        The offer was accepted within the hour.

        You just never know if they're blowing air up your rear, attempting to hike up the price.

        • Ash-Say on 06/08/2015 - 08:10

          After making a purchase, can I make a complaint with NSW Fair Trading based on the fact that I beleive the agent tricked me into making higher offer when there was no offer higher than my previous offer?

    • ProjectZero on 03/08/2015 - 10:08
      +5

      I second what you've said regarding the price.

      1) Whilst there is a possibility the real estate agent is lying, you don't need to call his bluff. If you are happy with what you've offered stay firm and if you don't get it bad luck. If you really want to buy the place then you will need to weigh that up to see whether you can go abit extra.

      2) Just because they advertised as offer over $XXX,XXX does not mean you need to follow this. A friend who is a real estate agent has told me many times when I was looking for my investment property, do not follow the price guide unless you think it is worth it. I've so far placed an offer on three properties all of which were lower the the price guide and the real estate agents have always treated it as a genuine offer. Worst case scenario, someone thinks its worth the price guide and up, wants it that badly they are willing to pay extra etc. and you lose out.

      3) Not too sure, it would be good customer service as the real estate might want to "assist" you in finding another property which you might like. reat estate game is all about making connections, the more clients you have the better, regardless of whether they are high rollers or whether the client is just looking to buy a house and settle down.

      • RandomNinja on 03/08/2015 - 10:45

        Agree wholeheartedly with point 2. When I bought my place 7 years ago (Inner West, Canada Bay area), I offered 20% below the 'offers above' price. Got knocked back naturally, but it started the negotiation and ended up getting it for 10% below the 'offers above' price. Having said that, today's market is very different… pick your battles!

        • jellykingdom on 03/08/2015 - 13:08

          7 years ago in Sydney??? Not even close to the same situation. That was the beginning of the GFC and there was practically no growth in NSW market at all.

  • grabngo on 03/08/2015 - 08:37
    +14

    where are u buying for $550k?

    • tomleonhart on 03/08/2015 - 08:50
      +5

      Lol i wonder the same thing. Townhouse for 550k in Inner West ? !

    • Ash-Say on 03/08/2015 - 08:51
      +1

      For a record, I visited this property http://www.realestate.com.au/property-townhouse-nsw-st+marys… where the agent has told me that they received offers above $550,000.

      Stamp duty on existing properties is already a nightmare and after going through half a dozen open homes last Saturday, it has become apparent that the investors are pushing first home buyers like me out of the market by offering well above the asking price (I could hear 90% of people visiting the properties asking for potential rent so they were definitely investors). I am not complaining but it is very frustrating to see you cannot even purchase small townhouse these days.

      • tomleonhart on 03/08/2015 - 09:22
        +24

        I c. Althought St Marys isn't exactly Inner West.

        • mick123 on 03/08/2015 - 09:29
          +16

          lmao @ calling st mary's inner west. laugh of the day..

          all the best for the house hunting though :)

          pretty much firedragon nailed it.

          re point 3 - when I was buying a few years ago, I put an offer and was outbid by about $1500 or so and agent never got back to me. I would have offered a bit more if asked but then again, it would have possibly turned into a phone-hockey bidding war and for the agent, getting an extra $5k or so is only about $50 in his pocket so he will just do what he has to, to close the deal

        • bl1027 on 03/08/2015 - 14:43
          +6

          The first thought when I read this post was that the OP found the bargain of the century: “a townhouse in Inner West Sydney for $550,000”.

        • [Deactivated] on 04/08/2015 - 17:27
          +3

          If St Marys is the Inner West, I'm living in Sydney CBD.

        • [Deactivated] on 04/08/2015 - 19:48

          Ah, so the inner west of the outer west?

        • maxall on 04/08/2015 - 20:42

          @waterlogged turnip: I am swimming…lol

        • G K on 04/08/2015 - 23:26

          @mick123:
          With that scale, Brooklyn should be lower north shore :-)

        • DarkOz on 05/08/2015 - 06:58

          Come on guys. The OP didn't get the Inner West part wrong. He simply got the wrong city name. Blacktown Inner West it is.

        • Turd on 05/08/2015 - 09:36

          Toongabbie is innerwest so St Marys is cleary inner inner west.

          Just watch this video:

          https://www.youtube.com/watch?v=KUEM8qDKkwY

        • snook on 05/08/2015 - 14:34

          @Turd: that's a shocker but it's gonna get people who only shop on keyboard and don't live here. Would be interesting the know how many people get sucked in by that!

        • Guilty Flamez on 05/08/2015 - 18:47

          @Turd: 😂😂😂😂😂😂😂

      • ShatGPT on 04/08/2015 - 09:43
        +26

        Bahaha mate St Marys is well and truly Outer West, if not Central NSW or eastern South Australia.

      • whirlpool_guy on 04/08/2015 - 15:21
        +3

        "Inner West townhouse for $550k"

        I see what you did there. Tricked all of us to read your post! :P

        • toristo on 04/08/2015 - 19:38
          +4

          "Western Sydney" - Anything west of where you currently live.

      • ilikeradiohead on 05/08/2015 - 12:47
        +3

        $550k to live 45kms from the CBD? And I thought Perth had ridiculous property prices…

        • Guilty Flamez on 05/08/2015 - 18:44

          Property market in Sydney is insane at the moment

      • Guilty Flamez on 05/08/2015 - 18:44

        St Mary's is not inner west it's Western Sydney :) anyways good luck with your first house hunt may be you can check the off the plan property Doonside is a booming area and prices are affordable too.

  • CyberMurning on 03/08/2015 - 09:03
    -1

    st mary… hmm not the safest in the planet! eventhou the suburb name is wonderful.
    and agent.. well their job description is to lie everyday to make money.

    • Ash-Say on 03/08/2015 - 09:07
      +7

      My family friends have lived there for over a decade with no incident.

      Bankstown area is also notorious where I have lived for more than 4 years with no drama so I guess it really depends on people's perception of the area.

      • syousef on 05/08/2015 - 14:23

        My then pregnant wife was backed into by a driver while crossing the road after buying bird feed from a pet store in St Marys just over 7 years ago. (Accidental, not intentional, but it did her back in and she's been in pain ever since.)

        Anecdotes are just that. (Even though I know mine is true and am confident yours is too).

  • BuyoTheCat on 03/08/2015 - 09:28
    +9

    They always say there is someone offering a higher price. I have never heard of anyone's first offer being accepted.

    Even if you offer $1 million. There will be "someone" who has offered more.

    • snook on 04/08/2015 - 14:44
      +2

      April 2015, my first offer on an (true) inner west property was accepted.

      10 days on the market. I simply told the agent that this was it, take it or leave it, it was all I was offering. Found out later that the owner was desperate for the cash and just wanted to go. I was the only offer. I offered 50k less than the asking price of 'offers over …'

      • BuyoTheCat on 04/08/2015 - 15:08

        So you told that him straight up?
        If you didnt say that and just put in an offer, I wonder if "someone" will show up

        • snook on 04/08/2015 - 15:18
          +1

          Straight up. I was over these agents pissing me around.

          The previous wednesday night we had been to an auction. We had wasted two weeks on that property because the agent said the owners wanted 100k less than we had. It sold for 120 more. It so wasn't worth that. It was a ridiculous price. The house we ended up with was much better value and cost less.

          I have said the same thing in the past and they haven't rung me back. I got lucky this time because the owners were desperate for the cash. It can happen, even in this market.

  • whooah1979 on 03/08/2015 - 09:37
    +1

    Agents that disclosure offers like the one in op is shonky as hell. They do it for the sole purpose of inflating the price and their commission. Blind offers is the only way to buy. Walking away was the right thing to do.

    • ProjectZero on 03/08/2015 - 10:15

      I don't think the agent disclosed the actual offer… just giving a rough idea as he stated "in the range $550,000"

      • Tnetennba on 04/08/2015 - 04:51

        I think he may have had another offer, so he knew he could perhaps seal the deal on the other offer, but why not try asking you if you can offer $550k? He's got nothing to lose, and what if you had said yes?

        It's a sneaky sort of business, real estate, always be weary.

        • ProjectZero on 04/08/2015 - 09:01

          Yeah, that's how all good salesmen work…. get the best price for their clients

        • BartholemewH on 04/08/2015 - 20:25
          +2

          @ProjectZero:

          Not sure why you got negged. In case anyone is wondering, the agent works for the seller, not the buyer.

        • wolfazrael123 on 07/08/2015 - 10:58

          not really. agent work for themselves. Best price gives them best commission. If no good offer is given, they would still try to let the seller sell at a lower price so they can get commission.
          @BartholemewH:

  • [Deactivated] on 03/08/2015 - 09:55
    +13

    When I bought, the seller was an airline pilot and his wife.
    I made an offer, the wife accepted, so full steam ahead.

    Agent then rang and said the pilot was out of town and had just indicated the offer wasn't enough and he wanted another 3K, so I told him the game was off and cancelled my pest inspection, etc. I fugured husband and wife would have discussed this before he got on his plane.

    The agent was obviously lying because when he called me later that day to tell me the husband had now agreed to the original price, he was clearly nervous, when I told him I had cancelled the pest inspection so he would have to wait longer to sign documents.

    They play their game, and you have to play yours.

    I once read that if you offer a non round number, it helps, as the impression is that you have done your maths and that is all you can afford. so instead of offering 475K offer 474 250. You can then round up to 475 easily if required.

    • Ash-Say on 03/08/2015 - 10:01

      It looks like it will be a blind offer. If I make low offer, I might lose however if I make high offer I might end up as a winner but potentially pay more than market value.

      • ProjectZero on 03/08/2015 - 10:19
        +1

        Just think of it as poker… never show your hand… in other words, don't jump straight to the highest you can offer.

        Say you have a pre-approval for 500k… don't say 500k for the first offer, say something like 460 or 465k for the property in your link. sure it is under the price guide, but unless there is overwhelming interest, they will treat it as a genuine offer and will check with you if you can up the offer when it comes to crunch time.

        • sagrules on 03/08/2015 - 11:14

          If you are seriously considering offering more for the place I would check with the bank that you have approval for your new offer.
          Agents lie all the time, unfortunately this industry is still unregulated - if you feel like the price guide given is false you can report them.

          Have a look at past sales in the area or similar properties to determine if this place is worth the increased price.

        • tiara on 04/08/2015 - 09:52

          I did that but missed out. I made an offer 30k above the asking price ($580k) and I prepared to go higher but the agent rang me the seller has accepted someone else's offer which higher than mine.

        • ProjectZero on 04/08/2015 - 10:11

          @tiara: You win some, you lose some… did you find out what the final price was? It should be published after it has settled. prehaps the guy offered 60k above or something.

        • snook on 04/08/2015 - 15:54

          It's a blind auction. There are no offers. He only has one shot.

        • tiara on 05/08/2015 - 01:16

          @ProjectZero: yeah i thought they gonna make counter offer first then i would up my offer

      • snook on 04/08/2015 - 15:54

        Early 2014, and the guide is 860. We know it's going for at least 960. The agent went blind auction and friends put in 963. They were worried about overpaying etc. They were the highest by 7k.

        You really need to have a feel for what is selling for what in the same area and then be prepared to make your best offer, one that you would be willing to go to at auction. After all, it is exactly the same thing.

        You're not going to get any deals in a blind auction. You're going to pay your premium price if you really want it.

  • jellykingdom on 03/08/2015 - 10:36

    I'm not entirely sure if it is legal either (i.e do they actually need to have a better offer?). I know my real estate agent (selling) just uses the line of "there are other offers. please put your best offer forward" and literally does not discuss price at all. I personally think that is a very ethically grey area, and I'm not entirely comfortable with it, but I suppose that is what I'm paying him for!

    All i know if that when you see "Offers Above" my general rule of thumb from 3 months of house hunting, is that you need to budget at LEAST 10% more. Usually 10-20% more. This rule has been true for almost every house that i saw. That is the best advice I can give you right now. For example, you see a place for 550k? It will sell for somewhere between 600-650, without any doubt in my mind. We had one which we liked, the agent said "probably 575" and it went for 790……..that was a bit of an eye opener!

    I also suggest that you make an offer on ANY house you like, because it buys you some breathing room. Houses are being sold in 2-3hrs in some cases, so you need every minute you can get to do your homework

    But yes, only pay what you think it is worth

    • Richardc on 04/08/2015 - 13:38
      +1

      The price guide is always lower so more people will make an offer, that way it looks hot to the vendor, also when the REA received the "highest" offer then they will ring the top few offer for higher offer.

      • snook on 04/08/2015 - 16:00

        Actually, the price guides are often set by the prospective buyers. If you go to open homes in Sydney now, the agents ask what you think as you leave and that's where they get their prices from. If you go to a first open, they don't have a price because they're waiting to see what the buyers think.

        In a constantly rising marketplace - more buyers than houses - the guide price is always going to be lower than what it sells for at auction.

  • johndowy on 03/08/2015 - 10:54

    Even if the property is advertised as "From", "Offers Over", "Buyers Over", etc. I would offer less then their advertised price. You need room to move.

    • jellykingdom on 03/08/2015 - 13:03
      +1

      Mate, seriously, in NSW you will literally never find a house with that method. I'm sorry but it is just the truth. Whether or not you are being "scammed", the fact is, if people are willing to pay it, then that IS the price of the house. Supply and demand

      If you turn up and offer less than the advertised price, the agent will not even bother to ring you back. I guarantee it

      • ProjectZero on 03/08/2015 - 15:35
        +1

        If you turn up and offer less than the advertised price, the agent will not even bother to ring you back. I guarantee it

        That's only if there was a lot of interest in the building… not all properties have a good turn out of potential buyers, and there is the possibility that not all of them would be willing to put an offer through.

        I bought my property last october and gave an offer of less then the advertised price, bought it after some small negotiations and then I bought the place.

        It's worth a shot, and just because the place is said to be worth 500k+ by the agent, it doesn't mean it really is.

        • jellykingdom on 04/08/2015 - 09:17
          +1

          Whereabouts? Currently, as far as I can tell, everywhere has a lot of interest in any building. I haven't been looking at apartments mind you, only standalone houses

          You can do that kind of thing in some suburbs, but everywhere that I know of, from Newcastle to Sydney, to Penrith, to Wollongong, is being sold in a heartbeat for way above asking price

          For e.g My friend's parents just sold their family home to downsize. They asked for $650k. Had about 200 people come through over the 2 weeks, and then it went for >$800k in the end

          For e.g The first house we decided we wanted to make an offer on was listed as $690k approx. It sold at auction for $880k

          I'm not trying to be pessimistic or stop op from buying, i just think I'm helping him out by telling it like it is. I wish someone had told me straight up that i needed to adjust my thinking, because we wasted probably 6 weeks of looking before we fully understood how it all worked and were able to fight back

        • ProjectZero on 04/08/2015 - 09:27

          @jellykingdom: Before I bought mine last year in October-ish. I looked around the western suburbs (blacktown and the likes).

          I visited about 10 different properties before buying my current one. Long story short, most of the properties I visited had less then 10 people show up. Not many of them had people put in offers either as the agent was actively seeking potential buyers.

          With the current market, it is possible that this has changed, with more people focusing on western suburbs than before, but it really does come down to the interest shown on the property. Obviously if there is a larger turn out of people, try and make a decent offer, one that you are comfortable with. You'll need to gauge this yourself though. Also I find that houses are more popular as they come with land so even if the house looks like crap, as long as the land is big, people are willing to buy.

        • jellykingdom on 04/08/2015 - 09:32

          @ProjectZero:

          Ah fair enough. Blacktown was very popular when I was looking recently, even though frankly its a total sh*thole (like a lot of those older legacy suburbs out there). People have been driven out West by the high prices nearer to Sydney and Parramatta.

          We already bought something in the last few months, with land etc, but we ended up going nearer to Penrith

      • johndowy on 04/08/2015 - 00:22

        It's people like you who believe that, that makes agents happy people.

        • jellykingdom on 04/08/2015 - 09:13

          Bit easier for you over in Perth where people are practically giving property away! Did you try that approach in 2008 during the mining boom? I bet you didn't

          I know it is happening like this because i tried it that way to start with. And agents will not even give you the time of day

          I bought my first house in 2012 with the traditional "They want $500k, i will offer them $450k and meet in the middle".

          The current market is set in such a way that "They ask for $500k, what they actually expect is $550k offer".

      • snook on 04/08/2015 - 15:01
        +2

        Haha Jellykingdom, wrong - I bought a house in Dulwich Hill in April (yes 2015). I offered 50k less that the 'offers over …' price and it was accepted.

        Just so happened that the owners were desperate for the cash. So desperate they didn't want to wait around for any auction advertising period. Since our purchase wasn't conditional (no house to sell first) they took a short settlement and pissed off. I've been waiting for the bikies to turn up and claim the money owed them but so far, so good.

        • zeomega on 05/08/2015 - 09:32
          +1

          I've been waiting for the bikies to turn up and claim the money owed them but so far, so good

          Revenge is best served cold. LOLOLOLOL

        • kctt on 13/08/2015 - 01:51
          +1

          You are lucky. May i ask the house is above or below 1M?

        • snook on 13/08/2015 - 10:08

          @kctt: >

  • slow on 03/08/2015 - 10:57

    One think I have learnt through buying selling properties is to never assume that what a real estate agent says is necessarily the truth

  • Davo1111 on 03/08/2015 - 12:59
    +2

    it's a bluff

    • snook on 04/08/2015 - 15:12

      It's not a bluff if they don't get back to you. In Sydney, they don't get back to you.

  • bl1027 on 03/08/2015 - 14:42
    +1

    1. There is no way to check but the agent would be risking a lot by “bluffing” you without actually having an offer on the table. So in this case you said no, did the agent come back to you and say something like “actually the other buyer dropped out, are you still interested at $510,000k?” In which case, you called their bluff. If not, then they most likely did actually receive higher offers. The agent said the offer was “in the range of $550,000” because if you were prepared to match the offer, then there is an opportunity to negotiate with you.

    2. Depends on supply and demand. In this case, the agent told you that someone offered more than 10% of the asking price. My advice in the current crazy hot Sydney climate is to determine for yourself what you think the place is worth and to put in that offer. If it doesn’t get accepted, then move on. Don’t muck about and think that you can always increase to your actual offer. The agent will most likely disregard your offer if it is well below other offers that they currently have. Its a seller’s market.

    3. In this case, the agent called to advise you that there is a higher offer and to give you the opportunity to increase your offer. But you declined. So don’t expect another call back.

  • Ash-Say on 03/08/2015 - 15:28
    +3

    Thank you everyone for your valuable feedback :)

  • Oofy Doofy on 03/08/2015 - 21:02

    Golden rule, any property you look at can/will be up to 25% overvalued.

    Back when I was looking for property in metro Brisbane areas, many times I made blind offers of exactly 25% less than the asking price and 50% of the time they said, 'OK, DEAL!'.

    Just a thought. The market in Sydney though, I guess you are going to have to become a firm negotiator and a poker player at the same time, in order to get something at the right price.

    • ITveteran on 03/08/2015 - 23:57
      +1

      What are right prices? If you win you never know it's over valued or not. So as long as you can afford and feel comfortable with, I think that will be ok.

      • Oofy Doofy on 04/08/2015 - 13:14

        True. Though, as I said, in the Sydney market… you don't know who you're up against and it's crazy down there. The worst thing that can happen is they say no. You just have to know how to walk away if they aren't willing to negotiate. TBH, you shouldn't negotiate with terrorists.

  • ahly92 on 04/08/2015 - 00:14

    How about getting ur partner/friend to call up and pretend to be int but offer a lower amount then u (much lower) and not budge.repeat couple of times then ring again later to see whether they'll accept ur offer .

    Worth a try ;)

  • T1OOO on 04/08/2015 - 06:20
    +1

    Op, it's irrelevant if there is another offer on the table or not. The seller won't sell for less than $550k. He knows he can get that. He would have accepted the offer but he hasn't which means he wants $600k or more and in this market will get it.

    Realestate 101.

  • theguru1 on 04/08/2015 - 07:51

    Of course you will pay too much. You will have paid more than anyone else would.

  • SlickMick on 04/08/2015 - 08:04

    That's an unethical real estate agent right there. The other guys offer should have been presented to the owner, who either accepted offer and house is now under contract, or rejected it and your bid should have gone to the seller. Laws require it done that way in Qld. This "I'll hold your signed contract but won't counter sign until I see if a better deal comes" is not fair.

    • Richardc on 04/08/2015 - 13:42

      but in NSW the offer it's only hold if contract exchanged.

  • Bludgeman on 04/08/2015 - 11:38
    +3

    Here's my tip which has worked for me every time I've bought.
    Instead of putting in your highest offer(eg. 510k), put in an arbitrary offer like $502500. EVERY time, without fail the agent will come back and either say someone else has put in the same(very unlikely) or higher offer. Here's where you bump it up to your highest. If they accept, you know they were lying in the 1st place & just trying to bump it up. Will save you thousands. EVERY agent I've dealt with is a lying dog so don't trust any of them.

    • ufohunter on 04/08/2015 - 12:02
      +2

      I don't quite follow how this saves you money if bump it up to your highest. Do you mean you don't go ahead if they don't take your initial offer?

      • Bludgeman on 04/08/2015 - 12:55
        +1

        Sorry what I mean is:
        If, as your first and highest offer, you put in 510k. The agent will come back and lie to get you to put another offer in to secure the property. Even if it's 2k, it works. I know lots of people who have fallen for this. By putting in an arbitrary number, you can flush out their lies. I'm only saying this because it worked for me and saved me a few thousand.

  • suti on 04/08/2015 - 12:29
    -4

    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?

    Ask them to sign a statutory declaration saying that they have received an offer in the $550k range. If they do it then they are legit (i'm pretty sure its something they don't want to goto jail over), if they don't then you know why…

    • onlyletters on 04/08/2015 - 14:11
      +2

      None of them are going to waste time signing one, it all needs to be done in front of a JP.

      • WT on 04/08/2015 - 14:24

        stat dec can be done at the cop shop. Jp is a little harder to find or for a different purpose

        • hayne on 05/08/2015 - 18:28

          Still, the original point stands - no agent will waste their time signing one.

    • snook on 04/08/2015 - 16:08

      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

      A: When they don't ring you back

      Seriously, there are so many buyers agents don't care if you walk.

  • snook on 04/08/2015 - 16:12
    +2

    In 2011 I wanted to buy the house next door for 500. The agent wanted 550. I didn't want to pay the extra 50k. The original 550 sale fell through and now it's going to auction. Someone at my work said 'what's 50k in the big picture? If you want it, you should pay.'

    I prepared myself for auction and to pay the extra 50k. 2 days later auction cancelled, house sold for 545.

    I can't stand the neighbours and the house is worth 940.

    Moral - pay the extra if you really want it. You aren't getting any second chances.

  • Cluster on 04/08/2015 - 16:30

    I've known of a case where the agent was on a sliding scale of commission. Above a certain price his cut of the money rocketed upwards, so he really pushed potential buyers to enter his preferred sales price zone and keep going higher. My advice is to call the agent's bluff. When they call with the story that 'we've had your price + 10%' offered tell them no.

    Stick to your preferred and realistic price and don't let yourself go into an auction with anonymous and often ficticious bidders. Chances are you are bidding against yourself.

  • Dr Techno on 04/08/2015 - 16:51
    +1

    Looks like low ball advertising to get interest and the real target is probably around 100k above the advertised price. I see this alot.

    Its best to see as many houses as you can within the area. Even ones that you cannot afford.. Do this enough and you get a good feeling for what a property is worth in the area the first time you see it. Best to also check out past sale results as well to compare.

    Then think to yourself how much is this property worth to me ? In your case it was $510k.. Then think again if the house sold for $530k would I regret not speeding the extra $20k to secure it ? or $520k would I regret the extra $10k ? Put in the max offer that your comfortable with.. Then it doesn't matter what the agent says.. If you get it then great, if you miss out then you have no regrets since it was the max offer that you thought was worth it. Also its good to put in odd value offers just incase you get to bet someone with just $1k or $500 :)

    At the end of the day its all apart of a game..

  • Wallyt99 on 04/08/2015 - 18:04

    We spent all of 2008 and 2009 making offers trying to get a deal. Must have been through hundreds of properties and a number of offers / wasted auctions. Eventually we found a place we liked and were satisfied the asking price was fair.

    We said to the agent - we are sick of looking - we are happy with the asking price - we won't pay a cent more - here's a cheque for the deposit- take it with our offer to the vendor. They can have until Friday (it was a Wednesday).

    They accepted.

    Next time - I visited one property - and same approach pretty much.- although no asking and offer was probably a touch under market. basically said honestly that it was as much as we could afford. Again offer in writing.

    Agents don't really want to redraft the contract for another $100 commission - buyers also see $$$ signs with a cheque in hand.

    Key is know the value. Offer it. In writing. With a cheque. Make it clear there won't be another.

    • grasstown on 04/08/2015 - 23:17

      How does this work with the cheque? As in, your security? What if the agent gave the cheque and he banked the cheque? Is that acceptance of your offer? Wouldn't you have to take him (Or the agent) to court to sue and enforce the contract if the seller was dishonest and does not carry through?

      • garetz on 05/08/2015 - 08:20
        +1

        The cheque is contingent on the offer being accepted, if the agent cashes the cheque, like to rort you of your money, he just committed fraud, and he will lose his job, get sued, possible goto jail. I doubt a real estate agent would risk that when they can rip you off legally many other ways.

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