In the premiere episode of ‘Biz of Property,’ our very own Brady Yoshia joins Ticker co-host Mike Loder to look at what buyers need to know about how auctions work, the key differences for online auctions compared to in-person auctions, as well as tips and tricks on how to approach an auction to ensure the best outcome on the day.
Biz of Property explores all things property and real estate with Brady Yoshia and the Brady Marcs team. New episodes will air fortnightly on Ticker News Fridays at 9:45am, or on-demand via the Ticker and Brady Marcs websites.
Mike Loder: Hello and welcome to Biz of Property presented by Brady Marcs Buyers Advisory where each week we will dive into the latest news and trends on the property market and answer questions you need to know for your property journey. And joining me today is Brady Yoshia from Brady Marcs, how are you today?
Brady Yoshia: I’m well thanks, how are you, Mike?
Mike: Doing well, doing well, looking forward to getting into a bit of what the latest is going on and picking your brain for some expert tips and tricks so thank you for joining me on the program. And guys, Brady Marcs Buyers Advisory are committed to putting buyers at the centre of what they do. Being highly experienced property professionals they create a bespoke customer experience tailored to each individual’s needs. Whether bidding at auction, negotiating or full service source and buy, Brady Marcs takes the stress out of finding your perfect property match. Learn more at bradymarcs.com.au
Mike: And of course remember whilst Brady Marcs is the listing sponsor of today’s program, the opinions and statements expressed in the following segment are of course our own. Alright let’s bring Brady back in. Now, let’s talk about Sydney because this one comes up a lot and I understand there was recently a very impressive sale that jumped a lot more than they thought I would get, take us through what you’ve seen.
Brady: Yes so recently there was an auction in Haberfield where the property sold about 2.02 million above reserve. That was a huge result, they had lots of competition, there were about 20 registered bidders and 6 was strongly competing against that property. So, I have to say it surprised everyone with incredible result.
Mike: And is this abnormal for the Sydney market? As we know we see on those programs the Lux Sydney market tends to be a big one. So is it abnormal to say this kind of jump? Has COVID had anything to do with it?
Brady: So it’s not abnormal to see it in the current marketplace. COVID has had something to do with it in the sense that there’s less stock on the market and huge buyer demand. So I think when you’ve got a combination of both, in Sydney in terms of suburbs that are very popular, that will create a much higher result.
Mike: Fantastic. All right, well I wanted to pick your brain on today’s episode, I want to talk about the basics about price guides, I understand you’ve got some really great insight. And if you could take us through a little bit about, I mean, what is a price guide for the uninitiated, exactly? Is it is it anything special or the thing that you need to consider, as somebody who has a lay man?
Brady: So price guides are very confusing, they’re frustrating and they’re like a Pandora’s box.
Brady: As a general rule, at least 10% of the price guide to get an understanding of where the vendor is at price-wise. And priceguides are usually set using comparable sales in the area.
Mike: Okay so unpacking what’s surrounding the property you want to purchase, the one you’ve got your eye on?
Brady: Yes, so having a look at the property that you’re interested in, I would be looking at comparable sales seeing what properties have recently sold for, and then look at the guide associated with that particular property, and add least 10% to that and that will give you an indication of where the vendors might be at price-wise.
Mike: Brady, where does that 10% number come from?
Brady: So when you’re looking at the rules, particularly New South Wales and some of the other states on an agency agreement, the selling agent has to have a guide, sorry a range as to where the property sits price-wise. So there’s got to be a 10% range. Okay now that you’ll see as a price guide will be at the lower end of the scale.
Mike: All right so what trends are we seeing at auctions at the moment with that price guide in mind, What are the differences, we’ve also seen between online and in person auctions we’ve obviously seen that massive shift, lockdowns that are ongoing, or at least on and then off. So what have you seen in that sense in terms of the trends that property at the moment is going on, I suppose in Australia as a whole.
Brady: Okay so, auctions, by their nature are very competitive. And at the moment with very high buyer demand and low stock levels, we’re finding that the auctions are even more competitive. And as a direct result, we’re finding the properties are selling 20 to 30%, above the guide. We’re also seeing auctions being brought forward. So the dates are changing. And in terms of online and in person, auctions in person, they are a lot more emotional, you can see your competition, and they’re more transparent. When we’re online, what we’re seeing is that they’re running at a slower pace, they’re quite disjointed, and you’re not sure where your competition is at.
Mike: What does that slower pace tend to do to the process does it does it does money get, you know, stalled I guess would be the word I would use?
Brady: It can be, it can also be quite frustrating from a buyer’s perspective, and the unknown, of not actually seeing where the other buyers or act that just slows the process down from the perspective of working out exactly where everybody else sits price-wise.
Mike: So Brady, we understand it’s an emotional decision. Do you have any advice to alleviate some of the frustrations people might be experiencing when heading into an auction or looking to buy a property that can help them, you know, feel a little bit better about it we’re all a bit stressed with lockdowns and everything going on but it shouldn’t mean we don’t have a good experience buying property.
Brady: Yes, so make sure that you do your due diligence, early, get your finances in order. See if you can purchase the property prior to auction, set a maximum limit that you are happy to pay, and not put yourself in any stressful situation. Always make yourself known to the agent, just in case you need to be made aware of any updates, such as the auction dates, and also as the price guide changes, any updates to the contract, and if in doubt, bring in a professional to help you.
Okay, that’s a pretty good rundown there and I’m, we’ve got the graphic up there on the screen but do, jill, due, do your due diligence, you say that three times quickly. What exactly does that mean when you unpack it a little bit further because as we know there’s a lot of dots points that you can consider when doing your due diligence.
Brady: So make sure that you have a building and pest report done, you understand that there’s no issues with the property, have the contract reviewed any changes you want to have made to the contract, have that done prior to the option such as if you want to change the deposit from a 10% or a 5% deposit. If you want to change the settlement period, anything related to the contract, needs to be understood. Prior to the auction.
Mike: It seems difficult with the online side of things, if you are trying to do your due diligence and you are trying to you know, visit the property see things you can’t exactly tap on the walls, like you would in person. How’s that working out as well?
Brady: Yes, so that’s a very interesting scenario at the moment. So what we’re doing is we’re getting the selling agents to walk through the property, do a video online and watch them online and we asked them to open up cupboards, turn on the taps and give us a scenario, give us a sense of the scenario that they are walking through. And also, what we also doing is, we finding that the vendor is getting a builder through and arranging the inspection for us, for all buyers, I should say, not just for us as buyer’s agents, but for the buyers in general.
Mike: Fantastic. And you mentioned video there as a walkthrough but have you seen the 3D virtual tours, people have been making use off as the pandemic has taken hold.
Brady: Yes we have. In Sydney, we’ve been very lucky that we are able to actually get buyers through on a one on one person inspection. So, that’s making it a lot easier but yes you’re quite right in other areas these videos are amazing.
Mike: Now, you also mentioned making yourself known to the selling agent and registering early. How does that relationship, look with a selling agency when you, I suppose walk in the door and shake hands and, you know, how do you build trust in the early stages, I suppose.
Brady: So I think from a very early stage is let the agent know when they call you to do they call back that you’re genuinely interested in the property. And once you ask them the right questions they will see that you’re not just there to have a look, and sit on the sidelines and watch and see what happens. So the more contact you have with the agent, the better off for these for you and the more rapport that you build up with the agents?
Mike: And you also touched on, if in doubt, if you’re at the end of the rope and you actually don’t know where you’re going, because I know there’s a lot of people out there who might be a little bit headstrong and they don’t want to bring in a professional – what professional would you bring in to start with?
Brady: So, a buyer’s agent, a property advisor would be the best person to bring in, and they could also just bid for you and an auction, not necessarily be with you throughout the whole process of sourcing a property, a lot of buyers don’t know that you can get that service.
Mike: Fantastic and ready just to wrap up, what are you looking forward to expanding on with the Biz of Property program just for our audience and what is Brady Marcs bringing to the table. I’m really excited to get the ball rolling with this one.
Brady: Yes, and so are we, what we’re looking to do is to educate the general public on all different topics and have a lot of fun along the way. So we want to talk about ex-pats. We have an ex-pat that works within our team has had a lot of experience of living overseas, and as well as working in relocations, so helping a buyer that is not in Sydney, or even in Melbourne, or any other states in Australia, to help them purchase a property. We want to educate the buyers in terms of what are the traps associated with purchasing a property. We also want to talk to them from a design perspective, things to look at. There’s so many exciting property…
Mike: Topics, property topics.
Brady: There are so many property topics that we can talk about.
Mike: Yeah, it’s awesome. I’m glad you touched on the traps as well because there’s definitely some tricks in there that people, you know the pitfalls, you might say but Brady thank you so much for joining us on our first episode of Biz of Property and giving us those main five tips. I look forward to unpacking all of those other topics as well.
Brady: Thank you so much. Looking forward to seeing you soon.
Mike: Guys that’s it for today’s discussion from the property space and I’d like to thank the team from Brady Marcs, and you, our audience for joining me today and don’t forget you can head over to tickeroriginals.co for more chats, tips and updates from property crypto cyber security, and so much more. I’m Mike Loder and I will see you again soon.