Knowing your agent

As the saying goes, knowledge is power. We often talk about the need for buyers to familiarise themselves with market values in their search area, but knowing the agents in their area is important too.

When it comes to private sales and negotiating prior to auction, agents can determine the negotiation rules. From “best and highest”, to back and forth, there are numerous ways that agents determine the play.

Unlike auction rules, there are no rules of conduct when it comes to private sale negotiation.

Some agents will determine a buy-it-now price when circumstances prevail, and others will go as far as conducting a transparent, simulated auction scenario when faced with multiple buyers. The rules will also change, depending on the market forces and the vendor’s situation.

However, each agent will have their own approach. Their own quirks.

Knowing how each agent approaches a competitive situation is certainly an edge, particularly when being familiar with how they adapt their processes with varying market conditions. Will they come back to you quickly with a response to an offer? Do you need to set a time limit on your offer? Will a time limit aggravate them? Will prompt follow-up agitate them? And what buyer-behaviour can you exhibit that will give you an advantage over other buyers? Most importantly, can you influence how the agent will navigate a competitive buyer scenario? Knowing what not to do is critical.

I’ve seen buyers play their cards wrong, so many times. Getting an agent off-side at the wrong time is a huge mistake when it comes to negotiating.

Naturally, there has to be some healthy tension when it comes to negotiating.

The difference between a sound, respectful approach and a bullish offer with unnecessary pressure can spell success or failure when it comes to buying a property. And just like this scenario can backfire for buyers, so too can a buyer who is too passive or unreliable. Agents will guide their vendor when it comes to presenting offers, and those buyers who represent a flight-risk will hold less appeal for a vendor and their agent.

No vendor wants to accept an offer from a buyer who may change their mind and cool off. Nor do they want to accept an offer that may fall over due to conditions in the contract not being met.

It is knowing how to navigate each circumstance with confidence and agent-familiarity that enables many negotiations to go our way.

When it comes to auctions, however, we still need to know the agent’s style and approach. Despite the fact that auction conduct is regulated, there are still aspects that can take a buyer by surprise. There are also important cues that can be missed if a buyer is unfamiliar with the auctioneer’s style and approach.

Take, for example the auction final call. Some agents labour the auction call many times over.

“Going once…. Going twice….. For the THIRRRRRD and final time……. Are you sure? it’s just a coffee a day. Maybe it’s her last bid. I’ll tell you what…. I’ll take a $500 bid if that helps you?” and so on. With scenarios like this, there is no doubt that the auctioneer is giving competing bidders time to comprehend that the property will be sold. They often like to buy time like this in order to give bidders more time to think about increasing their budget limit.

But there are auctioneers who don’t drag out the auction calls, too. Some will knock the property down quickly with a “Going once, twice.. three times… SOLD!” I have seen plenty of auctions like this, and sometimes with late bids. The devastation for an auction pundit who read the auctioneer wrong and missed out on buying is palpable when this occurs.

And we often see buyers standing in the auction crowd, expecting that the auctioneer will refer the last bid and go inside for a half-time show. Not all auctioneers do this, and not all auctions have a requirement for the vendor to have a half-time discussion. Missing an important cue, such as “We’re on the market”, or “playing for keeps” is a terrible blunder. As is missing the cue to bid in order to have the first right of refusal when the property is about to pass in.

I’ve seen so many times, when buyers have missed cues like this. It’s devastating for a buyer to watch another buyer walk inside to negotiate on the property that they had a sufficient budget to buy themselves.

Knowing the agent’s approach and style is certainly an edge.