PIPA Accreditation

Am trying to become a first time property investor. Cannot afford Sydney market so want to use a buyers agent to purchase interstate. Would you steer clear of buyers agents if they are not affiliated with PIPA? Sorry if this question has been asked many times before...first time on property chat too.
Have been speaking to an agent who is really pushing new builds vs established . Trying not to get spruiked. Thanks.

 

Can't say that I have heard of them however many buyers agents are members of REBAA - like @Jacque or @DaveM

 

I am too much of a control freak to give buying decisions to someone else but certainly if you pay professional fees make sure they are professionally qualified.

 

Welcome Rocky

You're right to be wary, but don't write off a BA just because they're not with PIPA. There's lots of excellent BA's and other property pros that are not involved with PIPA.

Don't ask for advice from a RE agent, that's a sure fire way to end up with an over priced property. Make sure that any BA does not sell off the plan property, or at the very least is happy to find established for you. If you need recommendations there's lots of people here who would be happy to let you know which ones they've had good results with.

 

Thanks all. Thanks Jess, this BA is pushing to sell brand new off the plan house and land packages within our investment limit of approx $400-450k (most prob Brisbane or Melbourne). To be honest sounds very cheap? would you not recommend off the plan?

 

I'd avoid anyone offering off the plan stuff, its extremely likely they're mates with the builder / developer and guess whose best interests they're serving?

 

Are you paying them or the seller? They need to be working off your brief ....

Are they getting any extra payment from the seller which they shouldn't?

 

Generally I don't like OTP - too much risk of valuations coming in low, and over paying generally.
Don't use a sales agent for advice on what to buy. Do your own research into what you think has good prospects for growth, so you can tell the agent what you want, rather than the other way around.

Edit - just read BA not sales agent. Definitely don't accept a BA pushing you toward anything, especially of the plan. It's almost guaranteed they're earning a hefty commission from the developer in addition to what ever you're paying them.

 

Ask if they are double dipping? That is taking a comm from the developer and charging you a fee as well. Its an illegal and unethical practice.

Sounds like you may have dodged a bullet or three.

 

In my experience PIPA is not an endorsement for buyers agents. Whilst there is merit in the course itself, many of the members I've met are flogging interstate OTP rubbish.

The last person I met advertising herself as a PIPA member was selling high rise apartments in Darwin, adamant that it was a growth market right until it crashed.

 

It is a fixed price for us to the BA. He did say he earns a small fee off the developer. Mind is made up. Not nearly as ready as I thought I was . Need to Do a lot more of my own research. Thanks for info on PIPA.

 

That’s a massive conflict of interest.

They’re spruiking off the plan....charging you....and making a commission from the developer.

Run.

Cheers

Jamie

 

wow, run as fast as you can.

 

From the Property, Stock and Business Agents Regulation 2014 - Schedule 5

(Developers are known to pay 5%+ for the leads from other agents which they convert to sales).

 

@Rocky9, a BA shouldn't have an out of the box solution for your investment strategy. They should understand your needs and requirements, discuss CF, CG, demographics, yield, vacancy rates etc with you before suggesting a property.

If you search for 'OTP' properties in the forum you will see most of us have a strong opinion against it (you will be paying a premium price for an asset where most of the value is in the building, not on the land (the land appreciates in price overtime while the building depreciates), it will take a long time for you to gain capital growth on this property, you can not add value to it, you can not be certain of the quality of the construction until it is finished, no guarantee the bank will match the price you paid when the property is finished and not mentioning the builder, the marketer, the sales people and BA are all getting paid by YOU) . Everybody is getting a cut and you are the one paying the bill. If this asset is the best you can have for this amount, it can be a maybe but most of the time it is a big NO NO!

 

It's illegal in NSW to act for both parties under Sec 48 (Division 4 Conflicts of Interest) in the same transaction. This agent is breaking the law by obtaining fees on both sides:
48 Duty not to act for both buyer and seller of land (1) A licensee must not act in his or her capacity as licensee on behalf of both the buyer and the seller of land at the same time. (2) A licensee must not enter into agency agreements in respect of the purchase or sale of land if the performance of services by the licensee under the agreements will or can result in the licensee acting in his or her capacity as licensee on behalf of both the buyer and the seller of the land at the same time.

 

It is illegal for a registered person with a license. Unlicensed ??

 

I would have more concern for mortgage brokers who get paid for the highest value loan they can write (they may call it maximising your deduction) . Loads of self interest risks exist. Lenders, BAs, REAs, sellers, are all sides to same issue

 

Newsflash: PIPA was created by Empower Wealth, there's nothing binding about any accreditation by being associated with this organisation. It's a self-fulfilling body of like minded individuals.

 

I had a sales agent offer me $10k a property recently to sell his new builds to my clients. I declined. He honestly saw no conflict.