As a buyer, open homes are a goldmine for garnering information. As much of a chore as you may feel them be, I believe they are a pertinent part of the purchasing process and shouldn’t be underestimated. Just remember, the agent is always present and happy to help. They are a great source of knowledge. Please, do not feel shy to tap that recourse. My previous blog touched on my wife and I searching for a bigger property (the search continues). I wish that I was able to attend more open home showings instead of working during the weekend and having to make an appointment to visit.
How many times have you exited a property and thought “where was the laundry?” or “how many rooms had wardrobes?” We have a tendency to rush. We can almost feel like we are intruding on people’s space with the frenzied buyer activity at the moment. This isn’t helped by the ½ hour open homes between 11 am – 3 pm Sunday’s that agents seem determined to run (please make open homes longer if you can agents).
Try and make an effort to be more aware when visiting a home this weekend. When I say be aware – don’t only look at the house but look at the people.
- Look at the body language between couples
- How long are people staying at the property?
- What are they saying about the property?
- Are people making an effort to talk to and ask questions of the agent?
- How busy is the open home?
If the open home is super busy and the agent is being lobbed questions left right and centre, spending a little bit of time in proximity to the agent can be valuable. People may inquire about incidentals you hadn’t thought of, and you can also read people’s attraction to the property.
I am possibly well tuned in after spending many thousands of hours over thousands of open homes reading people and ascertaining interest, but we can all pick up on a certain vibe if we make the effort to tune into it.
Onto the questions:
Can you provide some recent sales you think are comparable?
Request a list of comparable sales. This is a great idea and agents should always try and have sales lists at open homes. Pay attention to these as often the agent has talked to the owner through these same sales. Pricing a home is not an exact science and recent sold data in the area is extremely helpful.
But also do your own research. Look at sites like homes.co.nz, oneroof.co.nz QV.co.nz or trademe insights. Pick out a couple of local sales you think are similar and ask the agent how they think they compare to the property in question. Any agent worth their salt should know the sales you are talking about. The benefit of this, is now you take a little of the power back into your hands and you will also get a measure of how they compare your sales to the property in question rather than talking about their own chosen sales with potentially pre rehearsed answers.
How many sale documents have been handed out? How many people have been through the home? How many repeat visitors have there been?
Sorry, that was three questions in one. But we are really getting down to the nitty gritty and trying to ascertain interest levels. These questions are obviously better asked towards the end of a campaign. If you can find out how many people have been through, the repeat visitors and the number of tender docs handed out you will be a lot closer to an answer on how many might be fronting up on the day. I found a while ago that on a number of sales the visits to offers ratio was averaging out close to 1:10 (i.e 100 groups through could produce 10 offers) but this is VERY house specific. Many houses since have had a ratio much higher or lower than this. Not to sound like a broken record but don’t be afraid to squiz the agent.
Lets face it. All this only helps to some degree. It is impossibly difficult for even the agents to know how deep people’s pockets are, how determined they are to purchase or where they see value on a particular property. At the end of the day the price put on paper is on you. But it may assist in your gut feeling of how hard you would like to push.
Can you please explain in a little more depth the sale process for this property?
Although the basics generally remain the same there are often nuances between companies and even agents in regards to how they handle the selling process. Ask an agent to walk you through this. If the property is for sale by tender ask if any offers can be made prior or if it will go “to the date”. If the sale is by negotiation ask when the owner will be looking at offers. Again the golden rule is don’t be afraid to ask questions. That is what we are here for.
What information and reports are available?
Most agents are finding that with the consistently increasing buyer interest having a LIM (Land Information Memorandum) and builders’ report is much appreciated. It smoothes the process and often provides for a better outcome. Although purchasers could and should undertake their own investigations and get their own reports, having something upfront helps provide a baseline and makes for a more informed decision.
A rental appraisal can be added to this with the surge in investor interest and confidence. If it is a unit title a pre contract disclosure will be available. If it is a cross lease, the agent should have ordered the memorandum of lease along with the title. The agent may also make a general market snapshot available. Check to see the date of when any reports were ordered. We want to make sure they are as up to date as possible.
Is there anything in the way of disclosures on the property?
Great question, but try and frame it well. Make the question as non-confrontational and specific as possible and you will probably get a better answer and more information that way. Many people come out and just say “are there any disclosures”. This is fine but how about “I realise this home is 70 years old and a bit of wear and tear is always expected, but is there anything you are making people aware of?” Follow this with something more specific to get the agents brain working and dig a little deeper for information. Your follow up question could ask if there is anything physical (cladding, wiring, piles, pipes, roof), topographical (land) or title and lim related that has arisen.
While you are there ask the agent about the form of title as it may be an opportunity for them to explain more about the cross-lease, unit title, company share or fee simple situation.
Do the owners have a preferred settlement date?
This is a good question in the fact that it also prompts the agent talking about the owner’s situation. You may get an answer like “well the end of the month would be good as they settle on their new home” or “settlement is very flexible, it has been an investment property and is now vacant’. Often we have been told to ask why the owners are selling to gage how serious they are. But in reality, in the crazy market we currently sit in, why they are selling seems to sit a distant second to beating out everyone else vying for the same property. Nevertheless it is good to know when the preferred settlement date is to make your offer as attractive as possible.
Good luck to you all. It is more competitive than I have ever seen out there at the moment but most of the regrets I have heard from would-be purchasers over the last 13 years usually hinge around not buying earlier. So don’t give up, stay on top of the market and always feel free to touch base if necessary.
