By
Brokers who work with buyer’s agents may be benefiting from this relationship with fewer loan pre-approvals expiring and clients able to snap up off-market properties, according to Melbourne property experts.
The FBAA’s October 2024 Broker Poll, conducted by CoreData Research, found that of the professionals brokers worked with, they were least likely to partner with buyer’s agents.
The majority (62%) of brokers said they “rarely or never” worked with buyer’s agents, while 27% said they worked with them “sometimes” and a further 11% said they did “always or often”.
This compared with 60% of brokers who work with lawyers and conveyancers, and other more frequent professional relationships with accountants, real estate agents and financial advisers.
However Steve Tully (pictured above left), finance specialist at Port Finance Group, said he often introduced clients to buyer’s agents, and in many cases “our clients can usually buy quicker and at a better price”.
The speed at which buyer’s agents can secure a desirable property is a key advantage, he said.
“The advantage for myself and our business is that pre-approvals will often turn to formal approvals quicker than they might if someone does it alone,” Tully said. “We don’t want to be continually renewing pre-approvals that haven’t converted. It costs us money every time we submit an application.”
Tully said he had seen time-poor professional and expat buyers in particular benefit from buyer’s agents, because they either didn’t have time, or needed support understanding the local market.
“They can also often get access to properties ‘off market’ that they otherwise wouldn’t have access to.
“A buyer’s advocate who buys lots of property in Bayside [in Melbourne], for example, will likely get priority access to off market properties over someone who speculatively sends an email to an agent, due to the volume they buy.”
Wallace Advocates is one local buyer’s advocate business Tully works with at Port Finance Group.
Founder and director Emily Wallace (pictured above right), who works with a number of brokers in the market, said the biggest advantage for brokers was the purchase turnaround times that could be achieved.
“Pre-approvals are valid for 90 days, but a good buyer’s advocate should be buying in the first 60 days if they have been given the right brief and the right budget,” Wallace said.
This meant brokers are more often transacting within the pre-approval timeframe, she said.
Wallace, whose team helps buyers purchase properties “to call home” in Melbourne for under $2 million, said time-poor professionals, like shift workers, were regular referrals from brokers, as were highly inexperienced buyers who “had no clue” about buying a property successfully.
Property shoppers who are repeatedly seeing their pre-approvals expire are also benefitting from the “reality check” that could be gained through a broker referral to a knowledgeable buyer’s agent.
With about a third of all Melbourne property sold off-market, Wallace said that buyer’s advocates were giving finance broker clients access to a wider range of properties many people “never see”.
Wallace encouraged brokers to let buyers decide more often if they could benefit from a buyer’s advocate, rather than prematurely making up their own minds about making a referral.
In cases where a broker may assume a client cannot afford the service – such as with a first home buyer – Wallace said often parents were stepping in to help children secure a better property.
In some cases, Wallace said the “bank of mum and dad” was making a conscious choice to invest in a buyer’s advocate during the process rather than contributing to a deposit for a home loan.
Tully said a good buyer’s advocate could help give clients a competitive advantage in the market.
“I heard a stat that said the average person buys a property once every seven to 10 years. A good buyer’s advocate might be buying seven or more properties a month, so they are so much more experienced and equipped to not only uncover opportunities, but also negotiate a property for the best price.”
Tully’s experience has been that the investment made in paying for a buyer’s advocate has always been saved in the negotiation, “as well as taking all of the stress out of the search process”.
Introducing clients to buyer’s advocates can also support better long-term client relationships.
“In our business we like to act as a conduit to other quality professional services that can add value to the life of our clients,” Tully said. “There is no doubt that buyer’s advocates have enabled our clients to uncover opportunities and buy better than they would have otherwise managed themselves.”
As a broker do you work with buyer’s agents? How valuable are these partnerships to your business? Comment below.
