John McGrath - How To Find Out About New Listings First
One of the biggest challenges for buyers today is the lack of stock for sale, which is lengthening their search for a new home and in many instances raising the price they need to pay to beat the intense competition.
We haven’t seen a market this tight for more than 10 years. Last month, there were 39,000 fewer homes for sale across Australia compared to February 2020 before COVID-19 hit us, according to SQM Research.
This is incredibly frustrating for buyers, especially given the immense opportunity that historically low mortgage rates are giving upgraders and first home buyers. Would-be vendors are also frustrated because although low stock helps them get a better price, they then join other buyers in securing another property.
In such a tight market, there is little buyers can do to get an edge over their competitors. Pre-approved finance is an obvious one. The earlier you can sign a contract, the better. But the best way to get an advantage over other purchasers is to get yourself registered on buyer databases.
Not only will you find out about new listings first, you’ll also often have the chance to inspect them and make an offer before the public even knows the home is for sale. This is what happens during preview campaigns, which are run by many agents before they publicly launch a new home for sale.
Preview campaigns are for database buyers only. The agent will call or email you regarding every new listing that matches your criteria and you’ll get about a week’s head start on the market.
This precious extra time is a serious advantage in a fast moving market where many homes are selling within days of their public launch or vastly above reserve at auction. However, you need to be registered on more databases than you think, so I’m going to explain how it works.
The crucial first thing to be aware of is that preview campaigns are run off agency websites. You won’t find them on major portals like realestate.com.au or domain.com.au. They’re used for public campaigns, not previews.
For example, a McGrath agent running a preview campaign would upload the new listing to mcgrath.com.au, then send the web link to suitable buyers on the company database and their own personal database. About a week later, they will commence the public campaign by uploading the listing to the major portals and organising other marketing, such as distribution of DL cards.
Sometimes, the property doesn’t even go onto the agency website. The agent will call or email you to tell you about the home and invite you to inspect it before the photos for the campaign are done.
So, in your target area, you need to be registered on every agency database as well as the personal databases of the top 5-10 local area specialists working for those agencies.
You don’t need to make a thousand phone calls to get this done. Firstly, write a list of the agencies in your target area, as well as the top selling agents specialising in the suburbs you want to live in.
Next, email or call each of the top 5-10 agents to provide your details. They’ll need your full name, your contact details including email and mobile phone, your price range and your key criteria, including property type and number of bedrooms. This will get you onto their personal databases.
Then you can sit back and wait for advance notification of every new listing that suits your needs. Keep yourself registered on the major portals as not every agent runs previews, so you want notifications of new listings from them, too.
You might be wondering why an agent would bother running previews when buyer demand is so high. They do it primarily to get reliable price feedback. This enables them to adjust the price guide for the public campaign, if necessary, before the property is uploaded onto the major portals.
This is important because correct price positioning is crucial to the success of any campaign.
Lastly, a word of advice on making offers during previews. You’ve got to show that you’re serious, so make your first offer strong. Remember, you’re asking the vendor to forgo a public campaign in one of the strongest markets we’ve seen, so don’t waste time with cheeky numbers.
On high quality homes, it’s highly likely that you’ll have to pay a premium. You can do it at auction or you can offer the same money behind closed doors with less pressure and competition. I know what you’re thinking, though. What would motivate the seller to take even a strong early offer?
Well, firstly it can save them thousands of dollars in marketing costs. They also avoid weeks of inspections with strangers wandering through their house. There might also be personal reasons, such as the opportunity to end expensive bridging finance sooner, or perhaps they’re starting a new job in another state and they’d like to move as soon as possible.
If your offer is close to or above their dream price and the agent feels it is near or better than what could be achieved at auction, then you have a great chance of securing the home. Good luck!
The views expressed in this article are an opinion only and readers should rely on their independent advice in relation to such matters.
This article originally appeared in The Real Estate Conversation (March 22, 2021)
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