Take it off: how buyers beat the competition – realestate.com.au

Homebuyers in Brisbane are adopting an ‘early bird’ strategy to close on a house. New figures show that more and more buyers are purchasing property before it enters the highly competitive property market.

A new analysis by the Real Estate Buyers Agents Association of Australia (REBAA) revealed a jump in the number of homes being sold off-market – without a sales campaign or before the campaign can begin.

REBAA analyzed the latest property data to compare listing and sales figures and found that annual sales activity rose by almost 3 per cent nationally in the 12 months to September, but overall stock levels fell by almost 15 per cent over the same period.

In Brisbane, sales volumes were down 2.3 per cent year-on-year in September, but new listings were down 18.7 per cent in the same time and total listings were down 17.3 per cent.

REBAA president Melinda Jennison said the market mismatch not only pushed up property prices but also supported a turn to off-market properties by increasingly desperate buyers.

“When you have stronger sales activity but significantly fewer listings, it’s clear that more homebuyers and real estate investors are looking for off-market opportunities in an effort to secure their next homes and investments,” she said.

“However, with property prices rising in most jurisdictions, off-market properties are not the easiest to access for the everyday property buyer.”

This house at 199 Baroona Rd, Paddington, sold off-market for $11.5 million.

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Ms Jennison said off-market buyers generally had to pay a premium to prevent sellers and agents from putting a property on the market.

“Buying off-market doesn’t really guarantee that you’ll buy below market value or pay less, but it does allow you to buy with less competition,” she said.

“It may give you more time and in some cases the opportunity to negotiate with the seller, rather than being part of a multiple offer situation or being exposed to a bidding war at auction.”

Place Bulimba principal agent Pat Goldsworthy said while the Brisbane market was experiencing an increase in off-market sales, many of them were what he would describe as pre-market sales.

Mr Goldsworthy said pre-market sales were often part of a two-stage strategy where a property was presented to a select group of buyers before being publicly offered for sale.

“If a property doesn’t reach the desired sales price, it will go on the market,” he said.

“Buyers are very hungry right now and are taking advantage of pre-market opportunities.”

The house at 81 Brokenwood Cct, Gumdale, sold off the market for $2.3 million in October. Source: realestate.com.au

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Mr Goldsworthy said that in almost all cases a seller and his agent would only sell off- or pre-market if the price was right.

“An elderly couple recently sold a post-war house in Norman Park overlooking the city,” he said.

“They were going to auction with another agency, but were quite afraid of the process.

“I already knew which buyers were coming to that auction, so I approached them and within eight hours I had three or four bids on the house.

“It sold to a buyer within nine hours for a great price.”

Mr Goldsworthy said sellers and buyers in the $4 million to $10 million price range tended to be short on time and want discretion, so they were attracted to the idea of ​​a quick, private off-market sale.

“These buyers are looking for off-market opportunities through buyer agents and relationships with local agents,” he said.

According to the REBAA analysis, it was estimated that up to 20 percent of properties nationwide – or about 100,000 per year – were sold off-market, but accurate figures were difficult to come by given the private nature of these property transactions.

REBAA President Melinda Jennison. Image: supplied

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Ms Jennison said there were several reasons why sellers chose an off-market sale.

“Often, even in strong market conditions like now, sellers want a private sale over something else, perhaps because it’s a deceased estate, they’re in the middle of a divorce, or they simply don’t want the hassle of open houses every weekend,” she says.

“Buying off-market can be a good strategy because it reduces competition with other buyers, especially when offers are scarce, as is now the case.

“That said, although considered the ‘Holy Grail’ of real estate, buyers must do the necessary due diligence to ensure they are not sold like a lemon, wrapped in a shiny cloak from outside the market that may also be overpriced.”

Ms Jennison said that in robust market conditions, buyers should understand the pros and cons of looking for off-market properties.

“First, it’s not easy for buyers who buy a home a few times in their lives to find off-market properties,” she said.

“This is because they simply don’t have the network or sales agent relationships to be on their radar when these types of properties become available.”

Mr Goldsworthy said buyers should be able to act quickly and offer a relatively clean settlement if they want to buy off-market.

“They should also call agents in the area where they want to buy and explicitly ask to be kept informed,” he said.

“An agent will keep them informed if they think (the buyer) is a real offer that will perform.”