Sydney Property Muppets
35. Exclusive Buyers Series- Counter offer versus other buyers
Welcome to the Sydney Property Muppets podcast. My name is Kurt Lothar. I'm a real estate agent and with me and forever is Chris Clark the buyers agent. We nailed it Chris. Yes. Now you go excited. Then we stumble We're doing an exclusive series on a buyers negotiation journey Last week we did about the first offer and when you put that offer in and sort of how much now we're going to be talking about Well, this one's talking about the counter-office. We're talking about when the office got in and we're going to specifically talking about When the counter-office is against up other buyers So we're going to break it down to the three bars. We're going to talk about basically the the the black hole So how trust trust worthy how truthful are agents Wise and important to have you maximum number already predetermined for you into negotiations and also going to talk about the How big or smaller how the denominations go How do you when you then make a decision to come back with a counter off yourself? How big a strider? How do you go about that? How do we give you some comfort the negotiation tactics regarding the dollar figures? Correct. Okay. Now let's kick things off. Yeah, so how can we trust what the agent is saying? We're not saying and we're specifically talking about when they're talking about other buyers. So what can they say what can? Yeah, you've got an offer from us. You know, we the viewer. No, I said not from us. God You've got an offer from another buyer or do you always have another offer from buyer? Do you have to can you make someone up? You can't make someone up Chris. It's like an auction. You can't have a dummy bit I can't make it up. Okay. There's no some agents might though. Some agents might I think the importance is to build that relationship up with the agent because and when I talk about building a relationship up with the agent It doesn't mean you always get along with the agent. It just knows you know where they stand in terms of you're like I just know these agents a bit dodgy. Don't really trust even you've heard multiple other you might potentially have heard multiple of a rely It's great industry though. Reliable of a stories like an industry. It's just we're playing with a high dollar value. So It would be angry. Um So so you can't make up any of the buyers can't make up any other buyers. So there is another buyer Going do you have to always tell each buyer what their numbers are? I never disclose the price. The agent will very rarely ever disclose the price Oh, I'm going to correct you there Agents very often disclose the service. I don't disclose the price of the other Just so I don't know you like particular maybe it's a buyer's anything again. I'm in the luxury opposition But 95% of the agents tell me exactly what the other office Probably because I'm a buyer's agent and maybe we work on a more transparent basis probably a buyer's If you if you were just a normal buyer, then I can definitely I can almost definitely say I don't believe there will be some instances out there But most agents if they're worth their soul are not going to give you the exact figure I don't know when we've done negotiation. We've done a couple You have not ever told me the exact number so you are even with a buyer's agent You've asked it. You've also not told me exactly what's going on because the the game are really good real estate agent In terms of selling doesn't want to get into is particularly with normal buyers if I say 1.5 is an offer from someone I know that most buyers are going to be like 1.5 0 0 0 0 1. Yeah, like they're they're literally thinking that I can see we're going off a thousand or I can understand from a professional point of view and a relationship Agent may tell a buyer's agent sort of the number um, but Chris corrected me a bit. I'm wrong. There could be a bit of a caveat that be like Chris someone's offered 1.5 But we're not selling unless we're at 1.56 Probably the vendor scenario or the vendor they're not so I've had an offer from Kristen uh from Jimmy over here and Jimmy's offered 1.5 I'm assuming Selling age of may come back to you and be like look Chris. We have had 1.5. I'm just letting you know Our eight our vendors number it's all nice. We're another topic coming up as well as talking about counter offer against vendor So that's almost what you're talking about there, which let's put a pin that for now and come back that one I think the other thing is so I know Another real estate agent who received received an offer from a buyer, right? There was no other offers at that point in time And received off the offer was we talked at the last episode of this series um They offered below guy price that the agent etc. There's no other buyers They offered just a little bit below the guy price the following day another buyer came up And offered about $75,000 more or did offer some of those more In terms of the offer itself They went back to the original buyer and so there is now another buyer They told them the number and are you say that doesn't you know not something you do But they told the other buyer their number that buyer not using a buyer's agent said Okay, we are not making any increase We are not chained or offered to you show us their signed contract or an email from them with their names and that offer detail Which is breaking all sorts of legislation do not disclose for one secondly On the reverse of it would they have wanted their offer With their names on it being taken to another buyer. Yeah, no, definitely not um Probably on the no probably it rolls me up a little bit and it's probably because i'm really on the ethical side I work really hard for my vendor, but i try and black and white keep between the rules Is the buyer entitlement a huge? I think huge Now can I just oh quick get back to buy a quick and finish the story so then i've sent another buyer another buyer came up So it ends up something with about $125,000 more than the buyer when the agent went back to them and said it's now sold for that much money They got the entitlement. They got even more rolled up going you weren't being transparent You didn't tell me you wouldn't share the information. I was making uninformed. I've done everything Right, I've told you it numbers aren't bubbling down Literally helped you out and they said but you told me there was no buyers. Yes, when you put the offering there was no buyers Other buyers came up and now it's sold and then they're crying for them So to be pointing you can't lie as an agent However, a lot of questions we get asked when you come in was the owner selling at the end of the day Sorry buyers. You have no right to know why the agent why they're why they're selling um And at all to a degree for it for example if the house has Many many problems I'm not going to say the owners are fed up with the issues of the house We would separate be like look the owners are selling for whatever reason, but we would then disclose All the issues that have come up with the house. So because at the end of the day We need to make sure we sell we're getting our vendor the best figure while being ethical It's tricky right because buyers go well If it's a divorce situation if it's a deceased estate There is motivational characteristics that we need to advise The hard part is it doesn't actually impact the house the condition of it where it's based the location the qualities of it And so therefore if you're using a really good agent, it actually won't impact the process at all But there's this almost morbid or almost this is curiosity fact that people have And I always bring it back to Is this a house we want? Yes. No, great. Yes. Okay. Let's do it to diligence. What's the value of putting it? Well, let's move forward from that. Yeah, but I actually find the entitlement. They want to know the very beginning before they walk in the house. Yeah, and it's a little bit like, you know, How's your marriage sort of like, you know, asking what your Maximum budget is like really working out the dollar because we know as agents when you say you're looking at 1.8 that you're probably Undercut your maximum. Yeah, because you know, we know when you're going to 1.4 it's probably 1.5 2.5 So I think it's just let me talk about either the buyer entitlement and so much so So we just had a discussion offline before starting this How often have you advised let's say egotistical ones they've come through Yeah, and made an off I dictated a number No, no And then they've either gone mia or they then come up later on with a thousand prerequisites And made it a really impossible to go the deal falls through how often does that never happen? Sometimes happened I had it happen when I was struggling to sell one bed Probably the way here this morning you have one happen to you Had trying to sell the one bedroom unit now how to actually have it was the worst case because it's a very hard unit So it was tenanted and we had it happened three times to us But do you know what made it worse a month like three or four weeks later that buyer after making the offer showed back up into the property Not as reinvigorating their interest in it only to go at mia again. Yeah, so I So I think that's one thing to talk about. I'll I'll be the voice here rather than you talk about it because I think that's where some of you need to we all need to put you as a buyers that we might be a really good buyer We might be upstream. We might be truthful. We might only make it But unfortunately there are cowboys out there and we're there developers or just people who You know then and right there you can put in multiple offers else some if you wanted to and accept one and not take the other two But there's a way of conducting unfortunate. Not everyone does conduct themselves in that way And so really I think a kind of burn from all the bad buyers out there that unfortunately like buyers look at agents go Oh, they're all you know, not amazing The agents also go all your buyers aren't amazing. Yeah, the shoes works both feet We always just see the positive of our own life. Correct. Yeah, we're all special. All right, so That's nice. You know, I think the next two points, which are good aren't aren't the heaviest. Yeah Um, do you want to leave over the next one? Why is important to have your Top number your maximum number determined before entering negotiations now It doesn't have to be the maximum you can spend but what you have determined for that property Um because I always say would you rather climb up a hill and take a short time or a long time You want to get it over and done with as fast as you can for me with the negotiations If you know your top number and we'll say the top number you want to pay for this property is 1.5 Regardless of the guards at 1.3 1.4 1.5 1.6. Okay is That number that your your top number is you're going to have no regrets with how you get to that So if you end up paying it and you've gone in large jumps more jumps You've had no regrets getting to that number because you know, you're obviously you're still probably want to spend less than that But yeah, it's that it's a point that where you you are happy to still progress with the deal up until that point Yeah, because you're looking for property If you're offering 1.5 million dollars on anything, you better be satisfied with what you're like No, no, I think it's I didn't dovetail under I think it's just very simple thing. I've talked about before What even an auction or whatever scenarios just had that clear number of mine for that property You can you know, whether there's two islands is what you can afford and there's a value put against a property You might be able to afford to man, but you value that probably 1.8. That's fine Whatever those two numbers are cuz equally you might value probably a 2.2 and you're by just two your tops 2.1 So again, whichever one of those numbers is less that's pretty much where you're going to walk away from Play the devil's advocate. Okay, so if someone's been a thousand or more Then you you have to see walk away and you'll probably find like 10 20,000 in the back of the couch to be able to do it But by having it clear in your mind said it means or within having the negotiation or putting the office forward and going back and forth Um, you still think about things But you're not thinking about recapulating the stamp duty and the fees and so forth It's one element removed and here's a scenario where I think there would be one occasion that you may actually go A bit above your top number. You've said 1.5. You've got the 1.5 The agents come back and say look just letting you know someone's come back at 1.51 Or they've actually given that number or they've gone a little bit over and they might ask you do you have one final? Do you have one final address? You've done your numbers and you know what? You can put an extra $2,000 towards it. Yeah, you're you're happy to do that If the agent then comes back after that and being like, oh, have you got any more because of it? Walk walk away because they've said that why is I'm saying what is your best and final? I hold I always go back. I'm going to put in my best and final bet it is my final Yeah, so do not come back and ask what I had a few other one agent in particular ask quite You know in once now, I kept on coming back. We asked him for more and asking for more and asking more and I was like, no You told me best and fine. Yeah, I did what you said Um nicely crosses into and last point. So, you know how big a stride and so forth You go into do you offer in 1000 increments 5, 10, 50, 100? Yeah, um, it's we always Say with these scenarios. It's hard for us to do because we don't know whether you're spending 13 million or 1 million And we don't know the ins and outs exact scenario Which is why we say for this I feel the best is know your top number 100 so that way when you're offering whether you want to do large chunks and then get smaller or do small chunks and get larger or however it goes You're satisfied if you get the property. Yeah, um, and if you don't get the property Because it's gone over the budget then you've missed out. Yeah, you weren't there. We're one recently where my client we identified a problem of client had approved to spend up to 1.9 to spend on the guy price was 1.6 or 1.6 to 5 or something. I can't remember the exact details And it was us another vibe of you know going back and forth in 5 10 5 10s of increments and we finally got up it was a slow process. It was over 48 hours We'll deliberately slow playing it because we're just trying to Eat this out a little bit and see where I can get to Got to um the other by I got to 1.0 And I said to my by we've got two things to do here We can either keep going with 5 or 10 gate and it's likely they're going to squeeze you all that to 1.9 Because we're always bringing the other by with us. Yeah by the small And I know it's a lot of money but by effectively smaller increments We're effectively encouraging them come back as it says one or two We're gonna do that and we're likely I feel like we're going to spend 1.9 or we can put 50k on an hour massive knock out blow You'll always know that there would be two things you always would have left going if we get it for 1.85 You'll feel like you paid 50k over so I sympathize but equally you're also thinking yourself if I've gone slower It's likely in terms of the trend that we're just going to come with us. Yeah, we always think about the All the missed out moment. It's very rare. You think of the negative It's like making a decision We always think of if we make that decision or the negative and positives on that side But a lot of us don't think of well if we don't make that decision What are the other consequences if you're not making that decision? And you know finish off the story. We we secured it at that level and clients extremely happy You know as always once a purchase and sale is done Yeah, people are generally quite happy with vandals. So whatever vandals buyers And we saw the fact we saw that we identified that probably comfortable from 1.9. So it wasn't like for us We thought we paid over in the end, but that was part of the back and forth So chris now on to the last part We usually do three quick cues But last week chris came up with this google game google gas you type something into google and then all these suggestions come up and The other some has to guess this is actually why i'm starting this week. Okay. You can i've got a sentence Yep, and then curd's going to three opportunities to finish the sentence and if it gets Out of those three everyone it gets correct it gets a point you got it. I did win last week So why does my See armpit smell No Why does my heart No, why does my why does my eyes feel tired Yes, i'll give you that why does my eye keep twitching? Okay, thank you. I'll tell you that and why does my dog bark? Oh No, oh come on No, because why does my dog lick me is a very different statement to why does my dog bark? Yeah, and also do it's funny. Why does my heart hurt? Oh, and you started by those my heart you've changed you got one point. Okay, you'll turn on me Let's see if I can actually win one for once. So my my questions are You'll see my statement. Sorry cars are the best Vehicle Or transport my vehicle does not know no, I can't give you that one invention No What does it say cars are the best to race I'll give you that one cars are the best for drifting drifting out of it. Yeah, one wide What else was there? uh cars are the best therapy Cars are the best what cars are the best on grass? Japanese cars are the best German cars are the best drifting to buy to buy use for snow for new drivers Yeah, right. Okay. Nice. Yep one all one way. We'll call it even what i'm thanks playing along. Do you know how you say that in Danish? No a draw an ular cure an ular cure Uh next next while we're talking about what you to do when it's uh before auction Yep, how do we how to put an offer together? It's an auction campaign But you got you you submitting offers or you're going to start negotiating before I think it's going to be a repair Yeah, so if you know a friend that is in the process of negotiations or about to or starting their search Uh, please pass this podcast on to them even if it's just this episode or this little series I hope you enjoyed it. I reckon some useful information Thanks for dropping by