What is a Buyer’s Agent?
Buyers agents are licensed professionals who can assist a buyer in purchasing a home or an investment property. They will guide and advise you from the initial planning stage, through property market search, property appraisals, due diligence, background checks, negotiation, auction attendance, liaising with the real estate agent, exchange of contracts, through to settlement.
Buyers’ agents also act as the middleman, liaising between your solicitor’s, real estate agent, accountants, financial advisors, and mortgage broker so you don’t have to. They will also be able to interpret these specialists’ “lingo” and explain everything to you in simple terms.
What does a Buyer’s Agent do?
- Tailored strategy session including evaluating where you are in your current portfolio and how they can help you achieve your lifestyle goals
- Property search, research, and evaluation of local property market according to your criteria
- Source properties with the best capital growth prospects
- Feasibility study once you find the right property
- Attend public and private inspections
- Negotiate the right price for the right property
- Liaison with solicitor/conveyancer, accountant, mortgage broker, real estate agents, property valuer, building and pest inspections
- Liaise with Council and town planners
- Can sometimes assist in finding the right property manager
- Most importantly, a good buyers ‘ agent will educate you to make informed decisions about the value of a property
Why use a Buyer’s Agent?
- Gain access to unrivalled industry knowledge and insider contacts that can streamline the buying process and open the door to new, often off-market property investment opportunities.
- Save time, money, and hassle. When it comes to working with a buyer’s advocate means we’ll take care of the leg work, negotiation, and hassle that is synonymous with the buying process.
- We’ll perform due diligence and conduct research on your behalf including building inspections, pest inspections, and all of the nitty-gritty checks to make sure there are no undisclosed issues with your property investment.
- We live and breathe property, which means you’ll be across the latest changes to Sydney’s property market and avoid common sales traps.
- Whether you go to auction, or buy directly, our team will negotiate on your behalf to secure the best price. Our logical approach means that we can keep emotions in check and ensure that you buy sensibly.
- Support and guidance from start to finish – our team will be there with you each step of the way.
- We’ll be your go-to point of contact between solicitors, accountants, mortgage brokers, and financial advisors.
How much does a Buyer’s Agent cost in Sydney?
Buyers’ Agent fees will depend on the demand and experience of the Buyer’s Agent. Not all Buyers’ Agents are equal. The most experienced and established buyers agents which have proven results will be in more demand, so will often charge more for their services than the newcomers to the industry. This does not at all indicate that the more expensive fees will get better results, you are paying for an established name and reputation in the industry. When budgeting buyers agent Sydney costs, it is best to ensure you work with a Buyer’s Agent you trust, has a proven track record, and someone who understands your long term property strategy.
How can a Buyer’s Agent help me to purchase a home?
Your Buyers agent will guide you through the planning to ensure you are clear on what you can afford for your budget. Buyers agents will also provide suggestions on what you need to be flexible on, the local property market, as well as provide advice on your location.
Buyers agents will save you time by shortlisting properties that fulfil your criteria, so you don’t have to spend each weekend trawling through open homes. They can also assist arranging private inspections in times that suit you and your family.
If you’re nervous about purchasing your first property, a buyers agent will be by your side, guiding you to ensure you don’t pay too much for a property, or get caught up in emotions at the auction. They are independent and unemotional about the property purchase, so they will provide honest feedback and prevent you from paying too much for a property.
How can a Buyer’s Agent help purchase an investment property?
Your buyers’ agent can assist you in purchasing an investment property from initially setting a strategy to achieve your goal. Buyers agents will be able to guide you on the best suburbs to purchase based on your budget and strategy, and ensure you avoid the typical mistakes novice investors might make.
Often investment properties are purchased in locations not close to where you live, and a Buyers’ agent will be able to guide you on the best locations to achieve your strategy due to their vast knowledge of the property market, because they are working in the markets every day.
Your Buyers’ agent will be able to explain all the requirements for an “investment grade” property and assist you to understand yields, returns, capital growth, and cash flow.
Are Buyer’s Agents qualified?
Yes, a Buyers’ agent is required to be licensed in the state they are operating in (different licenses per state due to legislation differences).
A Buyers’ agent should also be a member of a professional body such as the Real Estate Institute of NSW (or QLD, VIC, WA etc), Property Investment Professionals of Australia (PIPA), or Real Estate Buyers Agents Association (REBAA).
You can check a Buyers’ Agents license registration on the Fair Trading website.
Who pays the Buyer’s Agent?
The buyer pays the buyers’ agent their fixed fee or commission, as they are acting on behalf of the buyer.
Every buyers’ agent has their own payment schedule and structure, which they will go through with you before signing the buyers’ agency agreement.
Regardless of whether it is a fixed fee or commission based, buyers agents will most likely charge you a certain amount upfront as an ‘engagement fee’ so that they can commence the property search and be remunerated for their time, with the bulk of the payment due when the contract goes unconditional.
Are Buyer’s agent fees tax deductible?
Purchasing A Home
Buyer’s Agent fees will not be tax deductible if the agent has helped you buy a property to live in. This Is because the property you are living in will not be generating you any income (i.e. there is no rental income). The tax office views that only expenses incurred relating to you earning any assessable income can be deducted.
Therefore, you will not be able to claim as a tax deduction the expenses incurred relating to buyers agents finding the property and negotiating the contract.
Purchasing An Investment Property
If you employed a Buyer’s Agent to assist you with purchasing an investment property, although not immediately tax deductible against income tax, fees for buyers agents may form part of the cost base for capital gains purposes in future. This means the fees charged by your Buyer’s Agent will reduce any capital gains tax you will have to pay when it comes to selling your property. The cost base is made up of the property purchase, along with many of the costs associated with the purchase, holding and sale of the investment property, e.g. stamp duty, borrowing expenses (loan application fees), legal expenses, auctioneer’s fees, capital improvement outlays and buyer’s agent’s fees.
Whilst an offset against future CGT may not be as financially beneficial as an immediate income tax deduction, it will offer some tax benefit in the future when you sell your property, which you may need to account for in your investing strategy.
