What you must know before buying a new home, according to real estate guru John McGrath

These are the essential questions every home buyers needs to ask the real estate agent, before making an offer on their next property.

Although agents are working for the vendors, the good ones understand that they need to build relationships with buyers in order to bring the deal together.

If you’re a motivated buyer with your finance approved, agents will be happy to help you find a home.

So an excellent way to turbocharge your home hunt is to build relationships with a few agents and brief them on the type of property you’d like to buy.

John McGrath at a Sydney auction. Picture: Julian Andrews

A lot of people will tell you that agents are not necessarily a buyer’s friend, and you should be a bit cagey about what you tell them – especially how much money you’re willing to spend. The challenge is that if you hold your cards too close to your chest, you run the risk of not finding out about other good properties that are about to come onto the market.

If you strike up a relationship with the right agent, I think you can be pretty open with them, but you must do your own checking before you make an offer.

Below is a list of questions I recommend asking the agent.

They may not be willing to answer some of them, but it can’t hurt to ask.

The more information you have before deciding what price to offer, the better.

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A good agent will build relationships with buyers.

The essential questions to ask an agent before making an offer

•What’s the price guide?

•Do you have a list of comparable sales to support the price guide?

•Have you had any offers?

•How many contracts are out?

•Why is the owner selling?

•Has the owner bought elsewhere?

•Has the owner done any major work, and was that work approved by council?

•If it’s an auction campaign, ask if the vendor is open to pre-auction offers

•Is there a building and pest report already available?

Attending auctions gives a good feel for what is happening in the local market. Picture: Monique Harmer

When researching a suburb, here are some other questions to ask agents:

•Which areas within the suburb are more desirable?

•Which areas or streets are best to avoid?

•Which parts of the suburb are affected by noise and traffic?

•Are there any restrictions on renovations, such as heritage areas within the suburb?

•Are there any major developments or infrastructure planned for the suburb?

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A word on price before you make an offer

The onus is definitely on you to satisfy yourself that the price guide the agent gives you is reasonable. You need to do your due diligence and make your own assessment of value.

It’s important to do your own research on price.

The easiest way to do this is to review recent sales on the major portals and local agencies’ websites. Create a list of similar homes that have sold in the past few months and their sale prices.

You can also buy a property report online that will include a list of recent sales and price growth trends for the area.

Also, attend as many auctions as you can.

Auctions are a fantastic barometer of what the market is doing. They’re a very easy way to get an understanding of what property values are doing in real time, and how strong the buyer competition is for local homes.

Be finance ready before making an offer.

If you’ve done your research carefully, you should have a good idea of a home’s value before making an offer.

If you’re still unsure though, you can always pay for an independent valuation.

* John McGrath is the founder, Managing Director and Chief Executive Officer of McGrath Estate Agents

Originally published as What you must know before buying a new home, according to real estate guru John McGrath