Get REALISTIC about real estate!
From time to time in our business, we receive totally unrealistic wishlists from would-be buyers who obviously have no idea of areas, median prices or the reality of current markets. A classic recent example was an overseas investor who wanted a large 4-5 bedroom freestanding home with 2-3 bathrooms, minimum 1000sqm of land in a quiet street within 10mins drive of a beach, cafe strip and city transport (max 20 mins via train or bus) for a maximum budget of… wait for it… $500,000. Here. In Sydney. OK.
Other requests have been less outrageous but still indicative that the enquirer has either done no online research whatsoever or has misconstrued our role as “miracle worker” rather than buyers’ agent. We’ve had investors who want us to find a residential property that is returning a 8-10% gross yield (so the property is cashflow positive from Day 1) developers who expect us to stumble across easy subdivision projects with maximum turnaround profit for little work (and often low entry level budgets) and home buyers who don’t want to hire our services but instead ask us to “keep them posted if we come across a bargain”. I do my best to remain calm and cool in the case of such unbridled optimism and attempt to educate as required, but sometimes I am left shaking my head in wonder. After all, if 10% yields, easy profitable developments and screaming bargains were simple enough to come by, and as much as I enjoy doing what I do for a living, I think I’d be semi-retired by now!
The message is clearly to undertake some form of due diligence before contacting a BA whom you’re interested in hiring. At the very least, hop online and check out real estate sites such as realestate and Domain, engage in some light googling and read some of the very best investor forums (www.Somersoft.com.au and www.propertyinvesting.com.au are good starts) to at least familiarise yourself with what your money can buy and if your criteria and/or goals are realistic. Whilst we can certainly help narrow and streamline your requirements based on your budget, it does pay dividends to back yourself with some knowledge of the areas and local council information, if this suits your circumstances.
And, if you’re thinking of dropping me a line “in case I come across any bargains” keep in mind that I pass these onto my existing clients…. for obvious reasons. Happy researching!