Property Hub - Investment Insights & Inspiration - Realty Talk: Tight Market Tactics + PM Pain Points + Make Winning Offers

Episode Date: March 11, 2022

In hypercompetitive conditions, how do you overcome tight seller's markets to find and secure a good property? Pete Wargent from Buyers Buyers joins us again to show you the way. Overworked Property Managers are often the meat in the sandwich so to uncover their pain points, the trends that are affecting them and the new platforms transforming their lives and improving your experience, we’re joined again by property management supporter Adam Hinds of Sorted Services. Many property buyers make common negotiating mistakes that end up losing them properties.  So to help you make successful offers we’re joined by property negotiator Scott Aggett from Hello Haus. RealtyTalk is your trusted voice in property investment and Australia’s most popular online property show.  RealtyTalk is brought to you by Realty, Australia’s leading search and social property distribution platform that helps investors like you beat the crowd, giving you the earliest access to property opportunities, listings, and insights. Check out Realty. RealtyTalk is hosted by top property investment expert, author, and founder of KnowHow Property, Bushy Martin. Find out how Bushy’s KnowHow team helps investors unlock freedom with finance and property here, and check out Bushy’s podcast Get Invested.  RealtyTalk is supported by BMT, a company that helps property investors save thousands of dollars each year by maximizing tax deductions from investment properties. Find out more. See omnystudio.com/listener for privacy information.

Welcome to Realty Talk, the show that brings together the country's most authoritative and respected property experts. Follow us on all the socials and subscribe for updates and exclusive offers. Realty Talk is powered by realty.com.au, connecting buyers, sellers and agents differently. Greetings and welcome to Realty Talk, your go-to place for all things property. I'm Bushy Martin from KnowHow Property Finance and we've got another cracker show for you this week. Now, in hyper-competitive conditions, how do you overcome tight seller's markets to both find and secure a good property? Pete Wargent from Buyers Buyers joins us again to show you the way. And overlooked property managers are often the meat in the sandwich.

So to uncover their pain points, the trends that are affecting them, and the new platforms transforming their lives and improving your experience as an investor, we're joined again by property management supporter Adam Hines of Sorted Services. And to conclude the show, many property buyers make common negotiating mistakes that actually end up losing them properties. So to help you make successful offers, we're joined by property negotiator Scott Aggett from Hello House. And before we share these great insights, make sure you don't miss an episode of Realty Talk by signing up on the realty.com.au homepage so that you get every show in your inbox every week. We've got a lot of property gold to unpack, so let's get things underway.

Hi and welcome. Now, if you've been trying to find and buy a property over the last 12 months in the current hyper-competitive market, you'll know that finding good properties is like finding chook's teeth. And if you're lucky enough to find one, they go on a flash often for much more than you're expecting to pay. So how do you overcome this and balance the playing field in finding and securing a good property?

Well, in recent times, savvy investors have engaged buyers agents, but this has often been perceived as expensive. Until now, that is. So to reveal a new unique service that gives you cost-effective access to a national panel of leading buyers agents that will put you back in the property driver's seat, we're joined by the co-founder of Buyers Buyers, Pete Wardgen. Welcome back to the show, Pete. Pleasure.

Sure. Thanks, Bushy. It's always great to be on. Thanks, mate. Now, Pete, what are the challenges that property buyers are experiencing in trying to secure properties in the current market? I think, well, first and foremost, it's just a lack of available stock. I mean, there's been a bit of media talk about vendors fearing missing out and rushing the market with listings. But if you actually look at the reality, Even in early 2022, total listings were down 8% in January. They're about 25% lower than a year earlier. So I guess first and foremost, just a lack of available stock on the market.

The fear of missing out over the past 18 months has largely been buyers just desperate to get into the market. So that always makes it a tough environment, especially for inexperienced buyers, because there's always that sense of having to do something just to get a property secured. Yeah, no, good call. So what can property buyers do about it then, Pete? Well, as you know, Bushy, real estate is largely a game of two things. One, finance, and then secondly, relationships.

So if you're struggling to find a property to buy or there's just too much competition in the areas you're looking, I guess you need to really build some relationships and get into the ears of real estate agents in the area that you're looking to buy in. So ideally, what you want to do is get access to pre-market or off-market deals. So get first look at property. So you're not there at the first open home with dozens of other people all scrabbling for a contract. What you really want to do is speak to the local agents, let them know what you're looking for and in which areas so they can pick up the phone when something appropriate comes along. Yeah, no, good call.

So looking at the obvious gap here, how does your unique new business buyers play into this area? Well, I guess what's different about what we do is that we're a national marketplace for buyers agents. So we have nationwide coverage. We've got no bias. We don't particularly want to see people buying in any area. We can actually recommend that people invest anywhere in Australia. Homebuyers, of course, are always looking in a certain path. But for investors, I mean, you can be borderless these days. We have no bias. We can help buyers and clients actually work through this strategy,

work out where are the best locations for the capital growth and the rental yields that you're looking for so it's an independent form of advice we've also got a lot of property market research tools that you can access as clients which will actually guide you through that process as well so that's the main thing that we do that's different we're genuinely nationwide and we've got buyers agents in every state and every territory yeah okay and if we break down the range of services that buyers buyers offer what what can a property buyer or an investor look to access well we've got three levels of service for all clients and all budgets so firstly we've got what we call the we plan service which is a 10-year property plan so that's the strategy and

advice service for people who just don't know what steps to take next yeah we all do offer the traditional end-to-end buyer's agent service, which we call WeFind. So that is from the working out where and what to buy all the way through the buying process and for an investor right away through settlement to engaging property manager, finding a tenant and so on. We do also offer something that's a bit different. And this is an entry-level product for people wanting to engage a buyer's agent which we call we buy and that's where the buyer actually does some of the short listing of the properties for us and then that way it's more of a negotiation and due diligence and acquisition service therefore much cheaper of course for the buyer yeah it's smart so what are

the key benefits of using buyers buyers versus going direct to a buyer's agent then pete well i mentioned the independent advice so we can work with you on deciding where and what to buy but generally because of that we can offer you a much more competitive fixed price so we don't charge a percentage of the purchase price or anything like that and because we've done a lot of the pre-work pre-qualifying buyers before we hand them across to the buyers agent our prices generally will come in quite a bit cheaper so we'll save you time and cost and stress when you're going through your next purchase yeah one of the things that i love about the site is the the research information you get access which is you know second to none compared to any other avenue

in terms of getting some really good data to inform your decisions so I think you've come up with the perfect complement there of of the education piece I can access and then the delivery piece based on what their needs are rather than a an and or type of an exercise mate so I have no doubts that buyers buyers will continue to do well mate and I want to thank you for the update and thanks again for your time on the show. Always a pleasure. Thanks, Pushy. Thanks, Pete. Well, it's obvious that if you want to perform in a tightly held property market, you need to engage an independent buyer's agent. And if you want to take it to the next level, reach out to Pete and the Buyers Buyers team at buyersbuyers.com.au. Stay with us for more here on Realty Talk.

Successful property investment is a game of finance. Do you have the right team and the right game plan realty talk is brought to you by know how property more than mortgage brokers bushy martin and his team of investment architects set you up with a sustainable strategy structured to lower your costs tax risk and stress while increasing your capacity for growth know how has helped over 1900 homeowners and investors secure more than 800 million dollars in property wealth. So get set to live more, work less and live your legacy. Want to know how to invest in your freedom? Visit knowhowproperty.com.au. Welcome back. Now, having owned a property management business myself for many years, I know firsthand just how grunty and resource hungry the

world of property management can be. As all roads on an investment property end up on the property manager's desk, often leaving them frazzled and overworked. So to deep dive into the world of property managers to uncover the pain points they're suffering, the trends that are likely to affect them and the tech platforms that have the potential to transform their and your lives as investors. We're joined again by property management service supporter Adam Hines, the National Business Development Manager of Sorted Services for Australia's first all in one home services marketplace, allowing you to connect everything you need for your home all in one place. So welcome back to Realty Talk, Adam.

Thanks, Bushy. Welcome. Great to be here. Awesome, mate. Now, Adam, to kick things off, what are the pain points that property managers are currently facing at the moment? I think the big one for me in talking to a lot of agents and business owners is just burnout.

The last couple of years have been really tough on everyone around society, but also property managers are no different. They've had rental reforms, legislation changes, also the inability to speak to clients face to face. have had a lot of had to do a lot like we all have to do over zoom and they've had to adapt to that i think um property management real estate is very much a people business and having that ability not to be able to have face-to-face appointments going back to doing virtual inspections has made it really tough and i think the burnout on property managers has been it's quite high i think a report

came out a couple days ago from mri and they're looking at one in four property managers are looking at leading the industry i think it's really important that employees are looking at the right tools for the PM to do their role, whether it be training, the ability to have their work, home, balance, and also having the right technology. Yeah, good call. There's certainly some pressures. There's always been a lot of pressure on that

because you're meeting the sandwich as a property manager. But moving forward then, what trends do you expect to see for property managers this year? I just think the industry will continue to evolve. I think COVID has brought that in, evolving with technology, different platforms to be able to do their job easy. And I think tech business has also evolved. They might have had one element of their business

was doing something within the real estate space and they've actually pivoted and actually added more elements to their platform. I think virtual inspections will stay. Again, having the ability to be able to go out and see a property virtually and then lease it before it's actually been seen is a lot easier as well.

And I think that will stay. I think agents are seeing that. And I think the last one is probably just that flexibility, that work-home balance. And we're going to work from home and be in the office. Technology allows you to do that. I think business owners are going to also adapt to that as well a little bit more. I don't think your traditional five days a week in the office is going to be there.

There might be that flexibility where two days in, three days off to allow that balance, I think, to be really important moving forward. Yeah, good combination there. So focusing on the tech side of it, then how have tech platforms like the one that you've developed at Sorted Services transformed many property managers' typical day-to-day lives? I just think by automating a lot of the tasks that they do. So they're actually able to then adapt and look at dollar-productive tasks, so getting a tenant in quicker, getting communication back to a landlord quicker from an application, designing the lease. We're found in a lot of the work we've done with our property managers

who are using our platform, they're saving about an hour for every single new lease they create, saves about an hour's worth of time, whether it be automating an email back to a landlord or a tenant, even just creating the lease takes three or four clicks of a button. I think that's the biggest part for us, and that's where we're really able to help our officers create efficiencies and also dollar productive tasks back for the business owners. Yeah, it's a big innovation.

Time is a key ingredient and anything you can put back in their pockets is certainly going to make a very substantial difference and the landlords are going to benefit from that. So looking specifically at sort of services, what are the current features that you've developed that are aimed specifically at supporting property managers then? Well, for us, there's four parts of our business.

We automate a lot of the tasks. when a tenant's applying for a property, as I've spoken about before. So we can obviously automate the documentation back to the tenant. We can shortlist clients for the landlord. So again, that automates a lot of tasks and it saves time.

We have a payment platform where you can collect rent. The PMs have greater control on the rent collection, which makes it a lot easier for a property manager to look at what rent's coming in rather than waiting on the tenant to actually make a payment and then sending it in your bank account. We can actually help with that a lot more.

And obviously there are maintenance. Maintenance is the other part of it where we can ease for a tenant to lodge a mate's request. The Sorted app allows a tenant to lodge a request, pay their rent and have a little relevant docs in the one application on their phone. So if they're looking at when their lease is up, they don't have to ring the landlord or the tenant.

They can go straight through the Sorted app and have a look at when their lease is up or when their last paid rent or when their mate's request is out and everything's through the one app. Yeah, brilliant. That singular concentrated focus is a real boom for the industry.

and so I'd really like to thank you for sharing these industry innovations Adam and thanks again for your time on the show today. No problem Bushy thanks for that. Thanks Adam well if you're a property manager or your property is looked after by a property manager make sure they're freeing up valuable time and money by investing in tech platforms like Sorted Services where you can hook up your electricity, gas, internet, insurance, removalists and a whole lot more with just a few taps on your phone. Check them out at sortedservices.com. Stay with us for more here on Realty Talk. Property depreciation is the natural wear and tear of a building and its assets. Property investors can claim depreciation as a tax deduction each financial year. Depreciation

is a non-cash deduction. This means you don't need to spend any money in order to claim it. On average, BMT tax depreciation find residential investors almost $9,000 in first full financial year deductions. Call BMT on 1-300-728-726 today for an obligation free quote. Greetings and welcome. Now, if you want to be successful in buying a property, particularly in the current seller's market where multiple buyers are competing for a limited number of properties, you need to be an expert negotiator or engage someone who is. Why? Because most buyers make some common negotiating mistakes that actually end up costing them the property. So to discuss how you can make the ultimate offer using first offer tricks that do 95% of the heavy

lifting when closing the deal, we're joined again by Scott Agger, the founder of Hello House, who are actually expert property negotiators whose unique approach saves you money, time and stress. So welcome back to the show, Scott. G'day, Bushy. Thanks for having me. Yeah, I love your deep dives in this area, mate. You've got a real rare, rare skill there that's second to none in the industry. So to kick things off, what mistakes are buyers making when they push forward and make an offer on a property? I think the biggest thing for me is not understanding the buying process and not understanding market value.

I keep always coming back to that same thing, Bushy, but so many buyers make that mistake as they fall in love with the property. they haven't done enough research, it's all come too fast. Often, they haven't even got their finance organized. And the agents coerce them into making an offer. Once they start that process, they haven't got the ability to understand what's going to come next, understand what they say to the agents going to be used against them at another time at a later date. And they haven't got the ability to finish the negotiation and control it to the benefit of their own back pocket. So understanding market value and understanding the buying process and the steps that you've got to move through and the speed at which you've got to do it especially

in this strong and booming market in certain parts of australia is crucial and probably the biggest mistake that um any inexperienced buyer or someone that only buys once every 10 years for example um would make and it's a common common error yeah totally agree i've often said that negotiation starts at hello so and it's uh because whether you know it or not the agent is is sizing you up so absolutely like that's awesome but so how can buyers be smarter with the offer process to increase their chances of landing the deal then yeah well a key one for me is not start by offering low this is something that regularly happens when I was an agent myself sitting in that seat to give you some sort of psychology around how that process works when you're sitting

in the agent's seat if a buyer comes to me and gives me an offer that's too low we're just going to dismiss it out of hand we are going to of course put it to the owner but the owner we know is going to dismiss that because we've already indicated to them comparable sales at a higher price and we've set their expectations at a certain level so there is no bargains in this in this market really and you can certainly buy better than others can in this marketplace but you don't go around shopping thinking that you're going to get a 20 discount when you're buying a house it just doesn't really happen in this marketplace unless you're buying an asset that's under extreme pressure from the seller or it's a dud asset that they want to get rid of and you

don't want to be buying the latter of those two so i think starting with an offer that's really well thought through comes back again to market value but then having the guts to say okay if i go at 90 or 80 here i'm going to get a flat no i'm not drawing the seller into the battle into the fight you need them in the fight to make this happen and to and to and to win any ground so what i do is i'll study where the target price should be i do a lot of work with my clients or myself i'm buying to understand really what is that breaking point that is the drop dead number that we just won't go beyond and then i'll look at offering 95 to 97 percent of the way bushy and the reason i do that is because i'm looking to engage the seller or the agent too low you're

going to get straight no you get closer to it 95 97 percent of the way i'm looking for two things one it's enough to buy it with my first offer or two it engages them and they they actually come back with a counter offer or give me clear parameters of where i need to be so i think that's a really important thing that buyers need to know in this market and other markets as well this is going to work in terms of a flat market um if it's a down market then we can talk about this in maybe what 18 months time two years time we should see i reckon see what the skill set is and how we need to do that and a couple of key things that buyers can do easily is just ask the right questions so when you're at an open for inspection there's no point asking questions like

how many contracts have you got out? Agents are just predisposed to answer that question with three or four because they don't want to give you too many to scare you off. They give you enough just to create competition. So don't ask questions like that. Ask key questions about the seller's motivation.

What settlement time is going to suit them perfectly? What deposit size they want? Are they ready to sell today, Bushy? Are you going to take my offer and use that as leverage against other buyers and have them bid against me? Are you going to close it this afternoon if I give you the right number, how are you going to run that sales process? I want to know all that

for transparency. And then it determines where I put my offer and the timeframes that we might put around it. So I think asking those key questions becomes a feedback loop for me. And I use those answers to then reduce the roadblocks and the negativity in my offer and make that as attractive as I possibly can to a seller. Yeah, I love it. And what I love about what you just shared with us, Scott, is that it's not just about price. You're finding out what's really the other things are important to the seller or the vendor that may then enable you to make an offer that's different to everyone else's who are just focusing on price and suddenly you're standing out of the crowd. I love that approach, mate. So talk us through then how you would typically set up an

offer and leverage other property that you may actually have your eye on. Sure. So the questions is the first thing that I will always do and establishing what the absolute walkaway target price is. So those two things we've discussed already. Then I use a little trick, Bushy, actually, that does a lot of the work for me really quickly. Because if you're dealing with an agent, a lot of buyers will tell you across the country at the moment that they're quick to service you and they want to get your money. But when you're actually going through the offer process, often they don't ring you back. Once they know that you're engaged in the process, it becomes hard to kind of resolve the offer and get it to close.

So one of the things that I do to try and save my clients money on a building and pest report or time spent with solicitors and things reviewing contracts is to make an informal offer via SMS. And it does a couple of things for me. So the first thing it does is the agent will come back and dismiss it instantly and say, not enough, not interested, whatever the reason, vendor was expecting higher, comp was this, that's more than this,

or we've got other buyer interest above that level already. So that pre-frames what I need to do next and where I set my targets on the second offer if I need to. Or they come back and very often they'll say, put it on contract or put it on email. Instantly, I've just determined that I've either hit jackpot here or I'm off the mark and I'm going to have to put more on the table or it's not worth it because people are overpaying for it already

and it's beyond our target price. And SMS is really good because it's so blunt as an instrument. You do it on email. there's a lot of fluff that comes back in scripts and dialogues you're doing an sms typically they answer it instantly and they give me a black and white answer so that really does a lot of the work for me and if i know it goes to formal offer or a contract offer then they're either going to use that to condition the vendor to take market because they believe that's a good outcome to sell or they're putting it on contract because they know their owner is going to accept it so i think

if you can use that little free tip that'll um cut through the time that you spend you know in the negotiation process and get more deals done. Yeah, absolutely love that. Okay, well, and you've also in some of your past discussions mentioned leveraging other property that you may have your eye on. Can you expand on that one a little bit as well? Yeah, sorry, I missed that. And that last question, I should hit that as well. So leverage is a really good thing that I'll use commonly in my negotiations, but not all of them. I think it's important that you just don't apply a one size fits all strategy to negotiation because every negotiation is different. And as you and I have discussed off air, we're learning constantly in this job, 3000 property deals later, and I'm still

still learning every day in terms of how these things can often play out. But if you're going to use the leverage, it's so leverage just for the people listening at home is to obviously introduce a second property that you might have an interest in or you might have under offer already. And you're going to use that to get a better outcome and to close the deal faster on the property that's in front of you down the road. So it's a great trick if done well. But the key to doing that is to plant the seed at a much earlier time than when you need to start using the leverage and that might look like me and you Bushy going to an open for inspection and you being the agent and this might be a week before we actually get to making an offer or days before and I might say to you at

that open for inspection or private buyer appointment that Bushy thanks very much for showing me through I have got a serious interest in this property we really love it the only thing is we're a long way down the line with another property so we just got to work out where we go and the timing of all this because we don't want to lose both opportunities. When you revisit that conversation later when you're ready to make an offer to you, I would pre-frame that in the conversation to say,

look, you know, we discussed this five days ago or a week ago, that agent or that seller is giving me a lot of pressure to act on that property. Otherwise, they're going to put it to market. They want to sell. So we've got until Thursday, close the business. Otherwise, they're going to take it off us

and put it to the open market. So it's not me that's putting you under pressure. It's the independent third party down the road. But that brings me to this point, Bushy, we love your property it's our preference and the value that we see based on what we've got under offer down the road and what our dollars can afford us this is where we see value and it's really important that the conversation is away from budget and turn to value at that point so that's how you use leverage and value in that conversation to get what you want yeah i love it

and it actually flips the the scales in relation to suddenly putting the pressure on both the agent and their vendor to think seriously about the offer you're putting on the table rather than just be one of many that they're thinking about with no timeline or no no deadline that's actually going to affect the the move you're effectively you know reversing the fear of loss you're putting all the pressure back on the seller to make a decision otherwise you'll be gone by x date and it's not you going in there just with a sledgehammer saying take my offer by midday or i'm out there's a very subtle way of doing it and as i say if you can drop that into the mix earlier you'll be much better for it yeah i love it that's brilliant now you mentioned using sms as part of your offer

strategy can you unpack for us why you do so and how that changes the agent's response well i think the agents will just respond really quickly to sms so if you do something on email you're just going to join a queue they might not be back at their office and their laptop for hours and hours so you're not going to get a response out of them quickly i think if you do the sms it becomes a very casual conversation rather than a formal conversation and i just find that it cuts through really quickly and typically because they haven't got time they're busy people they'll just give you a very brutal response but that very brutal response is the key to unlocking the door it's going to show you that you're not in the ballpark or it's going to show you that you've

in this you know in this fight and you've got a you've got a very um strong dog aggressive dog who's going to win this battle so i like to do that it's it's a really you know low cost fast effective strategy for me that i know works and i've tested this you know over hundreds of of deals and you know you're not going to win all of them right so sometimes they're going to come back and say well we've already got interest above that level but you'd rather know that now rather than get the contract reviewed spend a thousand dollars at the solicitor spend two or three times doing second third fourth inspections spending five hundred dollars on a building and pest report and then work out that they've already got interest above that level so i think it's a good

way just to shortcut and hack the process yeah and what it also does i think is cuts through the the fluff that a lot of the agents try to and the and the maneuvers and scripts and everything else that they use to try and manipulate you into going their way if it's just a couple of couple of lines on a text there's no ability for them to start getting your head that way so we're bringing an approach mate love it excellent mate well look uh again i think we've only just scratched the surface here so well i think you're going to become a uh realty talk regular uh with some of the stuff you're doing because this really is at the at the leading pointy end of the whole exercise so i really want to thank you for sharing some of your trade secrets uh again today thanks

again for generous time on the show thanks for she cheers thanks mate well there you have it the secret to making winning offers on properties lies in your negotiation skills and as we heard from scott the devil's in the detail so if you want to improve your strike rate in the current hyper competitive market reach out to scott and his unique property negotiated team at hello house That's hello, H-E-L-L-O, house, spelt the German way, H-A-U-S, .co. Keep watching your go-to place for all things property here on Realty Talk. Well, that brings us to the end of this week's show. Another big thanks to our special guests, Pete Wargent, Adam Hines, and Scott Agger.

And to make sure that you don't miss an episode of Australia's longest running and most popular online property show, Subscribe to Realty Talk now on Apple Podcasts, Google Podcasts, Spotify, YouTube, or wherever you listen. And make sure you sign up on the realty.com.au homepage to get every episode in your inbox every week. And while you're there, make sure you check out one of Australia's most extensive range of properties for sale from over 7,000 agents nationally. Thanks again to realty.com.au and BMT Tax Depreciation for their ongoing support. I'm Bushy Martin from Know How Property Finance and I look forward to seeing you again next week.