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‘Off-Market’ or ‘On-The-Nose?’

‘Off-Market’ or ‘On-The-Nose?’
August 13, 2020 Propertyology Head of Research and REIA Hall of Famer, Simon Pressley

The term ‘off-market’ gets thrown around more and more these days. For the record, Propertyology has never been totally comfortable with it.

There are some fantastic real estate sales agents out there and Propertyology’s buyer’s agents are certainly very appreciative when afforded the opportunity to consider a property before the broader public knows about it. Sometimes we buy them, sometimes we don’t.

I have general concern for the growing number of property investors who seem to place importance on whether a property is ‘off-market’ or not. Here’s why.

Good decision-making requires complete clarity about the primary objective. For investors, surely that means selecting a property asset by following a process that gives oneself the best chance of a good outcome over the medium to long term.

This objective has absolutely nothing to do with how one discovers the property (via auction, private treaty, a distressed sale, or an ‘off-market’ property).

Let’s be crystal clear, off-market properties are not coated with gold dust! To the contrary, many have an odour about them.

In locations all over Australia, there are umpteen properties that sales agents bring to Propertyology’s attention every single week. In a lot of cases, the main reason for being provided with advanced notice about a property before listing for sale in the traditional fashion is because the sales agent is trying their luck at a quick sale so they move on to their next sale, or there’s something wrong with the property.

I think society understands that a salesperson is only doing their job by trying to sell ice to an eskimo. But a buyer’s agent who can’t see the ice from the glacier is failing to fulfil their primary responsibility.

More and more Australians are growing appreciative of the various areas where the expertise of a skilled professional, a buyer’s agent, can add value.

Atop the integrity list must be that the buyer’s agent doesn’t have a ‘stock list’ or a ‘listings portal’ of any kind. Legitimate buyer’s agents don’t have products to sell.

Property investors appoint buyer’s agents to bring expertise to the decision-making process. The best interests of the buyer must be their primary focus.

Key to achieving this is having a very structured selection process.

 

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While the ability to do a good off-market deal when they come around is an important skill, the best buyer’s agents are never tempted to cut corners and buy something purely because the property is there for the picking.

The right property, in the right location, at the right price are usually very hard to find.

Prudent quality control is not conducive to a high-volume business model; a sausage factory of sorts.

In Propertyology’s case, the criteria for selecting an individual property is quite ‘mechanical’. Our criteria has been shaped after many years of experience and evidenced-based studies.

Execution of a tight selection criteria requires precision, discipline, patience and a preparedness to be fussy. Buyer’s agents are paid to be fussy, not to operate a production line.

It means rejecting hundreds of properties and only buying a select few for the right reasons.

Skill, experience and the client’s best interests has nothing to do with whether a property is being sold ‘off-market’ or otherwise.

Simon Pressley is a 3-time Australian Buyer’s Agent of the Year and REIA Hall of Fame Inductee. Propertyology is a multi-award-winning buyer’s agency and Australia’s premier property market analyst. Every capital city and every non-capital city, Propertyology analyse the fundamentals in every market, every day. We use this valuable research to help everyday Aussies to invest in strategically-chosen locations (literally) all over Australia. Like to know more? Contact us here.

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