What is a buyer’s agent?

A buyer’s agent or buyer’s advocate, is a property-buying professional who specialises in searching for, scoping out and evaluating properties and negotiating or bidding at auction on your behalf. Their clients range from first-home buyers and time-poor house hunters to property investors buying in an unfamiliar area.

What’s the difference between a buyer’s agent and a real estate agent?

In a nutshell, the difference is their client. A real estate agent’s client is the seller (vendor) of the property, whereas the client of the buyer’s agent is, as the name suggests, the buyer (purchaser). The seller pays A real estate agent to market and sell their place. The buyer pays a buyer’s agent to find a property or undertake a range of services associated with that.

A dedicated lender will get back in touch with you within 1 business day. They’ll answer your questions about home loans and guide you through next steps. Your lender will be able to start the application for you.

What might a full-service buyer’s agent offer?

First up, the buyer’s agent should work with their client to discover exactly what sort of property they’re after: everything from location to number of bedrooms, closeness to shops, transport, schools and other lifestyle preferences.
 

The buyer might need a hand narrowing down their search, especially if it's their first home. They might be new to a city, or unaware of emerging hotspots. If that’s the case, the buyer’s agent can introduce them to areas they might be interested in. If the buyer is an investor, their agent would focus on potential capital growth or rental yield.
 

Once all this information is gathered, the buyer’s agent can use it to form a buyer’s brief and formulate a strategy for finding ideal properties.
 

Then the second stage, the property hunt, can begin. Ideally, the agent will provide a shortlist of properties for the client to look at: in ‘hot’ property markets they can notify clients as soon as a matching property becomes available.
 

If their client is interested in one particular property, the agent will conduct extensive due diligence, supplying a thorough property appraisal and their thoughts on the current market value. Should they still want to proceed, the agent can negotiate the property purchase on behalf of the buyer. After a successful sale, if you like, they might even liaise with your conveyancer, do a pre-settlement inspection and introduce you to a property manager if you’re investing.

How much do buyer’s agents cost?

There’s no set rule as to what you’d pay. Some agents charge a fixed fee, others charge a percentage of the purchase price (generally around 1.5%-3.5%), and some charge an up-front retainer fee when you first engage them.

A good buyer’s agent has experience in the buying process and auction bidding, and some even guarantee they'll find a suitable property within a set time frame, say 6 months, or you pay no fee.

Testimonial – Dom’s experience

"We were first home buyers with a very young family, and after 18 months of looking for our 'dream home', a friend recommended a property buyer's agent. So we did the numbers and signed an agreement: a 2% fee for finding and securing the right place within 6 months – no property, no fee. Our agent screened the week’s listings, did all the leg work, and emailed through their open house photos.

By month 5, our agent suggested an amazing off-market property that wasn’t even on our radar. He expertly negotiated the best possible price and then raced across town between our lawyer and the real estate agent to deliver our deposit cheque – before a competing couple could. For us, getting the right property for the right price and getting our weekends and sanity back offset the buyer’s agent fee."

Dom, Sydney.

Four reasons Australians might use a buyer’s agent

Finding the right place takes a lot of time and energy, with most buyers spending countless hours trawling sites and attending viewings. A buyer’s agent has the potential to add value, particularly if you’re a first-home buyer who’s missed out on sales, you’re investing in an unfamiliar area, or you want professional help landing your next home.

1. Experience

Understanding the tricks of the trade, local knowledge, and bringing expert negotiating and bidding skills to the table.

2. Value

An agent can offer value in the long run by achieving the best possible purchase price and saving you time.

3. Early Access

Established relationships with real estate agents, access to unadvertised properties, and a focus on capital growth and rental yield for investment property buyers.

4. Save time  

Have an expert do all the time-consuming filtering, open home previews and negotiating for you.

Three things to consider

1. Independence

Check your agreement to see if there may be a conflict of interest, as licenced buyer’s agents must declare if they’ll receive any commission from realtors or 3rd parties.

2. Fee structure

Note that a percentage price fee structure can disincentivise your buyer’s agent from negotiating the lowest sale price for you – as they’ll receive less commission. A good Buyers Agent will get their client the lowest sale price and see it as a badge of honour. While they may miss out on less commission, their reputation will be enhanced.

3. Licenced

Ensure you deal with a licensed buyer's agent by checking with the consumer protection agency relevant to the state or territory the property is in. In NSW, they’ll need to hold a real estate license or have a Certificate of Registration to practise.

Choosing a buyer’s agent

Here are some questions you could ask prospective agents:

• Do you have good local knowledge of my search areas?

• What are your most recent purchases?

• What’s your search and buying process?

• Do you have good contacts and access to unadvertised properties?

• Do you sell real estate?

• Will you put in writing that you receive no other commission/income as a result of the properties you recommend?