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For buyers, what is the typical home buying process in Australia?
I understand that the use of "buyer agents", such as we have in the US, is uncommon. I'm curious how that works.
Quite simlply, sourcing an appropiate property in an appropriate location, arranging inspections, negoatiating price and other terms on purchase, and arranging finance etc are all traditionally done by the buyer personally.
For buyers, what is the typical home buying process in Australia?
I understand that the use of "buyer agents", such as we have in the US, is uncommon. I'm curious how that works.
As dan said. I'd add that auctions are very common in Australia, in Sydney it would be almost unheard of to sell a house in a sale process except at the extreme high end >$20m which may be done through an expression of interest process.
Buyers agents seem to be much more common than they were at the upper-end. RE commissions are a lot lower, ~1%-1.5%, here than in the US, which means there is usually not enough in it to split commissions. We also have pretty hefty stamp duty tax imposed on property buyers ~4%-5%+ which again makes buyer's agents unrealistic in most instances. We don't have land tax though if you intend to live in the house.
In Sydney many homes are auctioned. So one must get finance approved, attend Open House inspections, have a conveyancer or solicitor negotiate any changes to the contract that you would want if successful.
Many people then make pre-auction bids which need to be high enough to persuade the seller not to go to auction.
It is all very stressful, my daughter has been through it recently, both buying and selling at auction.
But the procedures can vary from state to state. We have only dealt with QLD and NSW and in QLD offers are more binding than here.
I would not touch a buyer’s agent. Just one more person that you have to keep vetting re their honesty and intentions.
As dan said. I'd add that auctions are very common in Australia, in Sydney it would be almost unheard of to sell a house in a sale process except at the extreme high end >$20m which may be done through an expression of interest process.
Buyers agents seem to be much more common than they were at the upper-end. RE commissions are a lot lower, ~1%-1.5%, here than in the US, which means there is usually not enough in it to split commissions. We also have pretty hefty stamp duty tax imposed on property buyers ~4%-5%+ which again makes buyer's agents unrealistic in most instances. We don't have land tax though if you intend to live in the house.
For the benefit our our American poster Auctions are simply no where near as popular in QLD as in NSW, - Personally I have no idea why this is the case.
For the benefit our our American poster Auctions are simply no where near as popular in QLD as in NSW, - Personally I have no idea why this is the case.
From a seller's perspective they make sense. From the buyer's perspective you never really want to buy anything at an auction. Outside of Sydney, auctions aren't really that popular in NSW. That's probably a mix of higher home prices (auctions cost money to put on) and the likelihood of multiple parties being interested.
It's very funny that the Saturday evening news on TV will carry a quick grab of the day's auction clearance rate.
That being said, where I live in the eastern suburbs, a lot of stuff never makes it to auction or is never listed. There's enough demand out there at the moment that agents do quite a lot of selling through pocket listings. When we bought our current place I had a pretty good feel of what the comps in the area were and came in pre-auction above the price guide but probably ~3%-4% under where it would trade at. The owners came back with a counter that was reasonable and that was that.
As someone who has spent a life in financial markets/IB these things are quite easy reads. No one really gets an obvious a bargain and no one gets obviously ripped off.
From a seller's perspective they make sense. From the buyer's perspective you never really want to buy anything at an auction. Outside of Sydney, auctions aren't really that popular in NSW. That's probably a mix of higher home prices (auctions cost money to put on) and the likelihood of multiple parties being interested.
It's very funny that the Saturday evening news on TV will carry a quick grab of the day's auction clearance rate.
That being said, where I live in the eastern suburbs, a lot of stuff never makes it to auction or is never listed. There's enough demand out there at the moment that agents do quite a lot of selling through pocket listings.
Yes, in our part of Sydney, which is a lot cheaper than the east, a lot of houses are listed as going to auction if not sold prior. But they are still going very quickly right now. Dutch auctions are common but you really have to trust the agent with that.
Auctions not favoured in WA either. There was an attempt to kick it off some years back, but still not so common. Saying that have been to four which resulted in two houses selling above asking price, one withdrawn and other undisclosed outcome with discussions behind the scenes on conclusion.
One can sell their house themselves quite easily, ruling out real estate commission.
One would be quite silly to do that though. Seems to happen a bit in smaller towns though.
Happens in Darwin ( private sale ) One of my son's bought privately... no issues... and an easy settlement....
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