Is hiring a buyer’s agent to find you a home worth the cost?

In an increasingly challenging market, hiring a buyer’s agent to help find a home has become a more popular option in recent years. But is it worth it?

Hiring a buyer’s agent to help find a home has become a more popular option in recent years.

Hiring a professional just might help you buy at the best price and even mean you avoid purchasing a property lemon. But buyer beware, not all buyer’s agents are on a level playing field.

Here’s what you should consider if you’re thinking of using one.

A QUESTION OF SAVING

Choosing to take on a buyer’s agent isn’t always about saving dollars and cents, says Sarah Megginson, money expert at Finder.

“Anyone who’s ever been house hunting knows what a time-consuming process it is. For those who are juggling kids, businesses, extended family responsibilities and other commitments – it can be a really stressful time,” she says.

Buyer’s agents should offer more than just off-market sales. Picture: NCA NewsWire / Gaye Gerard

“A buyer’s agent is a professional advocate who can help you find and negotiate price on a property that suits your needs, making the experience far less stressful and frictionless.”

Cate Bakos, buyer’s agent and president of the Real Estate Buyers Agents Association of Australia (REBAA), says a well-rounded advocate does more than buy bargains.

“So many people assume a buyer’s agent’s value proposition relates to buying at a discount, or buying secret sales (off-market),” she says.

“While this can be the case, the greatest value they can add is clarity on a brief and, in particular, an ability to guide their client to high-performing properties that specifically match their brief.

“A future-proofed acquisition is valuable, as the cost associated with selling and repurchasing can erode any profits if the property purchase wasn’t ideal to the client.”

YOU GET WHAT YOU PAY FOR

Most buyer’s agents offer services beyond just house hunting.

“Really good buyer’s agents don’t just manage the ‘finding a home’ part, they also negotiate for you on price and terms. Depending on your own negotiation skills, this could more than make up for the fee you pay for their service,” Megginson says.

“They’ll also give you advice about suburbs and pockets you may not have been considering, and they get access to properties before they hit the open market.”

The right choice of buyer’s agent should be a neighbourhood specialist, Bakos says.

“An intrinsic knowledge of local areas, associated risks, planning regulations, encumbrances, lender scrutiny and sale contracts is what an experienced and qualified buyer’s agent will bring,” she says.

“Knowing which properties to walk away from, and conversely, which to pursue quickly makes the difference between a dud purchase and a successful outcome.”

HOMEBUYER’S REMORSE

While a buyer’s agent actually works for the purchaser (when a typical real estate agent works for the seller), Megginson says it’s vital consumers do their homework before hiring.

“The biggest risk is working with someone who’s not a buyer’s agent at all – they’re a sales agent attached to a particular project or development,” she says.

“They’ll only have one type of property they recommend to you, and they’ll often be very convincing and perhaps even pushy. But they are likely to be getting paid by the developer for every property they sell.”

Although a buyer’s agent’s fee could instead be spent on a home deposit, moving costs or stamp duty, Bakos says it’s worth looking at the long term value.

“It’s a lot more expensive than a buyer’s advocate fee to unravel a bad purchase decision.

“While I acknowledge it’s much harder for a first-home buyer to afford the fee, I recommend buyers chat to their preferred buyer’s advocate about various packages.

“Some will offer acquisition and/or due diligence services for one-off properties,” she says.