Buying from an Estate Agent

Property DeveloperLet’s be honest, no one likes estate agents. For outsiders they can seem intimidating places, full of aggressive sales people looking to sell you something you don’t want.

But before you judge them too hard here something to remember. Estate agents work on commission, they get paid on the sales they make. They also work on behalf of the vendor to get the best sale price for their commission. This is perhap why they’re often seen in such a negative light. Trying to push up prices and sell small cramped studio flats as ‘pier d’teir’!!

But you are different, as a property developer you know the property game. You cannot be fooled with an over priced flat that can’t be sold. You’ve done the research, you know what the other properties have sold for and you know what it’s worth.

At this point its probably worth highlighting a few things you should do when you contact an estate agent.

  1. Let them know you are a developer – Don’t deat around the bush, you are a developer, you need to add value to any property to buy and that means buying it at the right price. You need to be upfront and clear and don’t accept any property that doesn’t meet your criteria.
  2. Let them know you’re only interested in motivated vendors – Just so we’re clear, you are looking for motivated vendors. That’s someone with a real desire to sell fast. There is just no point intrying to buy from anyone who is looking for the best price possible you need a seller who wants an acceptable offer.
  3. Let them know you’re serious - It goes without saying really, but if I knew you where serious about buying I’d be making extra effort to make sure I’m on your shopping list. Make sure your Estate agent knows you’re an experienced buyer (even if you’re not). Drop hints about looking in areas outside of their reach. Let them think their in competition for your business.
  4. Incentivise them – Now it may contradict what estate agents are all about but sometimes their is a property that will be of particular interest to developers for the right price. Occassionally where a property cannot gain traditional finance or a seller has to sell immediately a short list of developer may be approached. You have to make sure you’re on this list. And as underhand as this may sound that might mean paying a finders fee to the agent. Make sure they know you would be happy to do this. You don’t want to miss out on an opportunity and you can always negotiate once you’ve seen the opportunity.
  5. Be their friend - Whilst it’s unlikely you’ll ever want to be friend an Estate Agent, as a property developer you must. They’ll be the one who will have a list of potential buyer for you to approach when you want to sell and they will be the ones who know the market better that anyone.

I know as i write this I paint estate agents in a bad light and to be fair most of them do a good job. However, right now things have never been so competitive. There are fewer properties on the market in many areas and this is where you can take advantage. Always talk to every agent in your area when you’re looking to buy and always keep an eye on new properties. I create an email subscription from zoopla, so I’m aware of any property that’s new to the market.