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Dealing with an REA when buying off market

Discussion in 'The Buying & Selling Process' started by Thorm, 22nd Mar, 2016.

  1. Thorm

    Thorm Well-Known Member

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    I called an agent and they advised me of an off the market property to sell. I'm thinking great, a head start, this is a good thing.
    I've looked the property up, it looks good, no real problems from what i can see. I'm asking a PM to go and have a look for me and give me their opinion on rent/cost/build quality etc.

    The REA said he has advised the vendors that he expects to list it at say, $500,000, and that if i want to buy it i should bid close to that avoid it hitting the market. If i check around i can see comparable properties selling for $470k - 490k.

    Basically, my question is what is the best way to play an off the market purchase? Do I treat it as I would a sale I've found through a listing?

    If i think the property is worth $480k, I come in with an offer of $465K as a start point. That's $35k less than his assumed listing and i think he'd take his chances with the market. Is it fair to assume he would counter?

    I think i'm over thinking things and just play it as i normally would with any listing, but i'm not sure if the game is different for an off market purchase :)
     
  2. samiam

    samiam Well-Known Member

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    hot market?
     
  3. Thorm

    Thorm Well-Known Member

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    Fringe suburbs of a hot market. I wouldn't consider it a deal of a life time, but it's certainly worth my time.
     
  4. Propertunity

    Propertunity Exclusive Real Estate Buyers Agent Business Member

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    The REA has advised the vendors that they should list at $500K. You think it is worth $480K but want to start with an offer of $465K. Personally, I would not expect that to work. The vendors may not counter offer, the REA may assume you are a low-baller and the end result is that you get no-where.

    IMO you need to discuss comparable sales with the REA and you then both agree on what the price should be. Then have the REA go to the vendor with a signed (by you) Contract at that agreed price which if signed by the vendor is then a done deal. The vendor chose the agent so you're best chance to buy pre-market is to make a fair offer that the REA personally agrees with and thinks he/she can get it over the line for you.
     
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  5. Mick Butterfield

    Mick Butterfield Well-Known Member

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    Completely agree with Propertunity. You do not really hold any cards in this scenario. Best bet is to pay a fair price that everyone is happy with and the deal can be done with a minimum of stress for all parties.
     
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  6. Thorm

    Thorm Well-Known Member

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    Thanks, good feedback.I dont want to get the REA offside, but i obviously dont want to overpay.
     
  7. Big Will

    Big Will Well-Known Member

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    Also not every time a REA comes to you with off market will be a deal of a lifetime. Sometimes they will use you as a buyer to set vendors expectations on price before hitting the market which could be detrimental to the sale.

    E.g. REA says 500k the vendors want the property is actually worth 400-450k a lot easier to get 3 buyers to come through and give 450k offers and take it back to the vendor to set their expectations lower before marketing.
     
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  8. dabbler

    dabbler Well-Known Member

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    Doing it this way just means easier for agents, vendor still expecting a good price IMO
     
  9. Scott No Mates

    Scott No Mates Well-Known Member

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    Also alleviating the stress of open houses.

    Inspect, discuss comparables with the agent (do your research beforehand), make your offer based at or close to the maximum that you'd pay. You've scored an open invitation, use it to your benefit without looking to screw the vendor or yourself.
     
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  10. Ember

    Ember Well-Known Member

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    All my off the market approaches from REAs were not good deals at all and offered to whole contact list not just me.
     
  11. Xenia

    Xenia Adelaide Property Manager Business Member

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    to ensure that the best price is secured for the vendor. They would not be doing their job if they relied on just one person submitting the correct offer.
     
  12. Ember

    Ember Well-Known Member

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    Of course, but REAs sometimes imply it is a special buy just for you.
     
  13. Scott No Mates

    Scott No Mates Well-Known Member

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    Unheard of....;)
     
  14. TMNT

    TMNT Well-Known Member

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    Do what i did!

    Contact the vendor directly.

    You might get lucky

    They may be despearate or dont want the headaches of dealing with an agent


    You got not much to lose except setting vendor expectations