Finding and Dealing with Real Estate Agents

January 8th, 2009
  • I’m an aspiring Real Estate investor in Australia, and I want to know what resources, such as articles, newsletters, etc there is on the internet that deals with real estate agents. Specifically: How to find a good real estate agent: There are so many agents out there, and I’ve read that most of them are awful. In fact, here in Australia there was a survey on the trustworthiest professions in the country, and real estate agents were at the bottom of the list, along with used car salesmen and journalists. I’ve read that you should "find an agent with a good reputation." I’m looking for better advice than that. So how do you find a good one to deal with? What do you do, what do you ask? Also, I’m reading about positive-geared property, so I’m looking for an agent that would be familiar with that concept. Any ideas on how to determine whether an agent really knows about it or is just bluffing to make a sale? I’m also looking for pointers on dealing with agents so that they don’t end up screwing you over.


  • Hi again, Markabee ! How do you find a good real estate agent ? You could do worse than to look for one displaying the "Jenman Approved" logo. I had the experience of attending one of Neil Jenman's industry seminars six years or so ago, and was very impressed with both the man and what he had to say. He has a website with extensive articles and information on it at: http://www.jenman.com.au The Jenman Group define themselves as: "A real estate education company promoting ethics in real estate. We receive no government funding. We do not accept corporate sponsorship..... Our aim is to make the process of buying and selling real estate safe and enjoyable for consumers. We offer commentary and opinions to consumers. Unless otherwise indicated, we do NOT charge consumers. If you have a real estate question, problem or complaint, we will do our best to help you. Please contact us ..... Although several thousand real estate people have attended our courses or lectures, the only agents we GUARANTEE are those who are authorised to display our "Jenman APPROVED' accreditation If you wish to contact one of our APPROVED Jenman agents, we will be pleased to provide you with details. Please call 1800 1800 18 or e-mail us. In areas where we do not have an APPROVED Jenman agent, we may still be able to recommend an agent who is in training to become APPROVED. Please call 1800 1800 18 or e-mail us. Unless instructed by you, we do NOT pass on your name to any agent." For Neil's slant on investment go to: " http://www.jenman.com.au/NewsAlerts1.php?id=21" (Personal experience tells me this works - but if you're buying a unit make sure to cost in sufficient for Body Corporate "Special Levies" for repairs they failed to budget for in the original levy structure.) Jenman's have free seminars for consumers, and it might be well worth your while attending one in your area. For another angle on Jenman, read the discussion at: http://www.crikey.com.au/business/2003/03/10/20030310jenman.html As for "positive gearing" (by the way, isn't that a second question, really?) it only means what everyone did before the government allowed tax concessions on an annual loss made on a real estate property- called "negative gearing" and really only useful for medium to high income earners. Positive gearing therefore means that you structure your investment to create an income for yourself, which you then declare for income tax purposes and pay tax at your appropriate marginal rate. Your real estate agent doesn't need to know this term; just tell him or her you want an investment property that will generate an income for you and go on from there. A very clear explanation can be found at Barrie Magain's site: http://www.barriemagain.com.au/bmpages/hints/rent.htm#bmnegative General advice: don't buy a property you haven't physically looked at more than once, don't buy off the plan, and don't believe anyone who tells you that Body Corporate levies won't increase - they will. Remember to set aside a budget for repairs. Search terms: Jenman real estate positive gearing


  • angy, What about articles on how to deal with the real estate agent(s), such as getting them on the back foot, negotiating, and... "Any ideas on how to determine whether an agent really knows about [positive gearing] or is just bluffing to make a sale?"


  • Hi, Mark ! Well, part of that's a whole new question, but I'm glad to pass on what I know. To take "positive gearing" first - it's a made-up term to mean "not negative geared"; that is, you intend to get an income stream from your investment. The real estate agent doesn't need to know anything about it. You just use the phrase to get him to shut up about the tax benefits of negative gearing. What the real estate agent needs to know is that you want a property which will show a good steady rental return for your outlay. Make sure you have allowed for the legal expenses such as conveyancing and stamp duty and the cost of surveys and valuations for loan purposes, before you decide on the amount of your deposit. Then for each property in which you are interested get a list of the annual outgoings such as rates and body corporate levies. Add that to your expected mortgage repayments and add a percentage to cover essential repairs, gaps between tenants and unexpected levies. Ignore the real estate agent telling you the levies and rates are not likely to increase - he can't possibly know that - and add a bit for inflation. Work out what rent you would need to charge to cover all of that and still show a profit. If you are going to use a real estate agent to collect your rent and deal with the lease arrangements on a day to day basis (highly recommended - this is something they seem to be good at) calculate their percentage. See whether it is reasonable to expect someone to pay that rent for that property in that area. If so, you're fine. If not, look somewhere else. Your financial advisor, or the solicitor dealing with your conveyancing, should be able to help in more detail on that. As for dealing with the agents themselves - most are ordinary people out to make a living, even if they do tend to talk the jargon of their profession. But as commission sales people, it is in their interests - and the vendor's - to get you to pay the highest price possible, so take neilzero's advice and tell them your top figure is $20,000.00 less than it is, or they will waste your time and theirs showing you properties you can't afford. Set aside three weeks or a month and treat your search for a property as a job as far as possible. Look at lots of properties with lots of agents, firstly by price, and then narrow down to area. Look at the local papers (not the SMH) for a feel for prices. Ignore bargains in the Multilist colour handout, they've always gone before the issue was printed. You'll gradually get a feel for which agent knows what. Remember the agent is not the person you are negotiating with. You are negotiating with the seller, through the agent he has employed. You are the one in the strong position. About the only way an agent will try and manipulate you (outside of auctions) is by implying there is another buyer after the property - "A dear old lady wants to buy it for her nephew" or "a nice young couple just starting out". This usually translates as: "If I don't close this sale by Thursday I won't get the commission on it until next month" or something similar. You are not trying to buy a house you've set your heart on; you're after an investment property. If someone else gets in first on one, good luck to them. If you are viewing a property that is to go to auction, and you ask the agent what it is likely to go for, of course he'll quote you high - it's in his interests as well as those of the seller he represents to get the highest price. If you've done your homework and really looked at the area first you'll soon know whether he's right or not. Read Jenman on auctions (see original answer) and avoid them if at all possible. It's too easy to get carried away, and you don't know how many of the other bids are genuine. If you must go to auction, set the limit you'd be prepared to pay absolutely, and send a friend with a mobile phone to bid for you. My personal advice: if you can afford a house rather than a unit, do so; this keeps the timing and cost of repairs largely under your control and avoids the whole nightmare of Body Corporate Levies. Talk to your financial advisor and/or accountant as well as to a couple of lenders to get a realistic idea of what your limits are before you start looking, and buy with your head, not your heart. This is general advice from personal experience, and not intended to substitute for professional advice. Get finance advice from finance professionals; real estate agents are expert in selling and managing real estate, not finance. The Australian Tax Office, surprisingly, has (usually) helpful and friendly people on their helplines who can explain the tax ramifications for you, while you remain anonymous if you like. A large selection of documents are available from their website: http://www.ato.gov.au They also have articles and advice. Good luck. A Google search on "dealing with real estate agents" (in inverted commas) turned up anumber of articles relating to the US scene, which is different from the Australian.







    • #If you have any other info about this subject , Please add it free.#
    Your name:
    E-mail:
    Telphone:

    Your comments:


    If you have any other info about Finding and Dealing with Real Estate Agents , Please add it free.

    Posted in freedeadaim.com | edit