“Just because the current owner paid more than the property was worth doesn’t mean you should.”
In most countries, the process of purchasing a property involves representation by both a buyer’s agent and a seller’s agent. These agents advocate for their respective clients, striving to safeguard their best interests and facilitate a mutually beneficial transaction that ensures fairness and equity for both parties involved. This structure helps mitigate any potential conflicts of interest, ensuring that neither the buyer nor the seller is disadvantaged during the transaction.
Due to inadequate laws, property transactions in New Zealand typically involve only one agent, exclusively representing the seller. As a buyer, it’s easy to misconstrue the seller’s agent as advocating for your interests, but this is not the case. By law, the seller’s agent is prohibited from doing so, as it would constitute a breach of their fiduciary duty.
The primary role of a seller’s agent is to negotiate for a higher price than the property’s actual value, whereas a buying agent works to ensure you pay a fair price and avoid overpaying.
You might consider yourself technologically adept and proficient at searching properties online. However, how can you ascertain whether the property you’re viewing is truly worth the listed price? Or what if there’s no specified price at all? What if it’s being sold through a deadline sale, by negotiation, or via auction?
How will you determine what offer to make? Will you seek advice from the agent, who is inherently working against your interests, for guidance on the expected price range? While they may provide a figure, it’s unlikely to be realistic. Furthermore, a property may seem like a good value proposition at first glance. However, this perception can be misleading as it may only appear favourable due to comparison with other even more overpriced properties in the market.
A growing number of buyers have foolishly started to depend on automated valuations produced by algorithms on property websites. However, these valuations are already outdated by the time they are published and lack the human touch of physically visiting a property. Consequently, there’s a heightened risk of being misled into thinking a property is well-priced when it is not.
Without the representation of a buyer’s agent, you risk never truly understanding a property’s actual value and falling prey to overpaying. We’ve seen countless instances where individuals have paid tens of thousands more than a property’s true worth simply by following the advice of selling agents or an automated valuation on a website.
We are licensed professionals operating in New Zealand under the guidelines of the Real Estate Agents Act of 2008 and in Australia under the Property Law Act, and we ensure that our clients receive expert guidance and advocacy throughout the property purchasing process.
The value of our advice will be immediately noticeable but will become unequivocally evident when you eventually decide to sell the property we assisted you in purchasing.