How do you make a strong offer on a property without overpaying? Uh, Andrew, buyers struggle with this all the time. Buyers need to know that agents are working to get the best result for a seller. So I have statistically tracked the success rate of offers that have actually led to settlements. As an agent, we'll, if we have two similar offers for the same price, one has a $1,000 deposit and one has $20,000 deposit, we're gonna be recommending offer two with a higher deposit all day long because we've tracked.

We know that someone offering a $1,000 deposit is more statistically likely to not be in a position to settle

Welcome to the Selling Southport Podcast. I'm Andrew Wright, Principal of Professional Southport since 2008. Real estate isn't just my career, it's my passion. With decades of experience, I know what it takes to succeed in the property market, especially here in Southport. Whether you're looking to buy, sell, lease, or invest, you can count on me and my team to deliver strategies that maximise your returns.

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Hi, everyone, and welcome back to Selling Southport. My name's Leon Waite, and I'm here with Andrew Waite, my dad. Uh, today we're gonna be going over how do you make a strong offer on a property without overpaying? Uh, Andrew, buyers struggle with this all the time. Uh, what's your

approach to it? Well, I think, um, buyers need to know that agents are working to get the best result for a seller.

So it's very, very important that buyers communicate with an agent, and when they make an offer, if the market is strong, you need to be probably within 5% of what fair market value is, because if you're not, the agent's probably gonna do their job. They'll report the offer to the seller, as we have to legally, and we're probably gonna say, "This guy's too far off the money.

I recommend you invite this guy to hang around and maybe increase their offer." And in most cases, we might not even provide a counteroffer in the early days. Now, if a buyer is in that situation, making an offer way low ball, it's probably because they don't have confidence in their own knowledge of the most recent comparable sale.

So my advice to a buyer is you need to be an expert. You need to know what are the last three or four comparable sales in this area, close to this property, so that you can help the agent go and sell your offer to the seller. So when I get an offer, and it's slightly b- low what the seller is asking, I'm gonna say to the buyer, "Well, why do you think it's worth it that much?

Give me some more information that I can provide to the seller so that we can try and come to an agreement." And it may well be that that buyer actually knows the comparable sales better than me and better than the owner. They may have just been to two or three open homes down the road that weekend of properties that are comparable, and they can give us some information to say, "Well, the one down the road-" is 25 grand less and it's got access to a shared swimming pool, for example.

Okay. And that's feedback that we can provide to the seller.

Understand. So basically it's about using logic over emotion, um, looking at comparable sales, how other properties stack up against it, what else has recently sold, and that helps us to get a good idea of what it's worth.

Absolutely. And on the other side of the coin, in a strong market, sometimes you get emotional first-home buyers that actually pay too much, and it's the fear of missing out that can create that.

So it's very, very important that as a buyer you need to know what the comparable sales are so that you don't pay too much.

Okay, understand. The deal

of a lifetime comes around about once a month, so if you miss out on this one, another deal will be coming around the corner.

Okay, understand. That's good.

Well, um, I guess as a buyer, we wanna make a strong offer, but from a seller's point of view, what makes a strong offer?

Well, the obvious, uh, term that is most important is the little section in the contract that says purchase price. Now, that's obviously- ... the strongest, but the top price doesn't always win.

So again, if you can build a relationship with the agent, the agent is going to be able to tell you about the seller's circumstances. Now, sometimes a seller might actually have second thoughts about selling because they haven't found the next place to live in. To some sellers, for example, they might be happy having a delayed settlement- Instead of 30 days, they might be happy with 90 or 120 days because they need a bit of time to go and find their next property.

In other cases, they might need a, an urgent settlement because they need the money to settle on another property that they've already purchased. So knowing those little terms, which might be more flexible, might create an opportunity where the top dollar or the top bid for the property might not be successful.

It might be in those terms that actually gets the deal done.

Okay. So as a buyer, I wanna approach the agent and ask the question, um, what is the seller looking for? What is their preferable terms? How can I make my stronger offer? Is there something that they would prefer over rather than just a higher purchase price?

Yes. And, and, and another bit of a trick for buyers when they're making offers is that as an agent, um, over the last 20 years, I have statistically tracked the success rate of offers that have actually led to settlements. And contracts with a $1,000 deposit are much more likely to fall over than contracts where we have a decent deposit.

So keep that in mind because as an agent, we'll ... If we have two similar offers for the same price, one has a $1,000 deposit and one has $20,000 deposit, we're gonna be recommending offer two with a higher deposit all day long because we've tracked. We know that someone offering a $1,000 deposit is more statistically likely to not be in a position to settle.

And if you wanna overcome those types of scenarios with your agent, it probably helps if you can provide them with a pre-approval letter to make the agent confident that you've actually got your finance pre-approved when you make an offer subject to finance.

Okay, okay. So I guess from a seller and a vendor's point of view, they're looking for certainty rather than just a number.

Uh, they wanna know that you can actually carry the

sale through Absolutely. They don't want the agent to ring them at the end of 21 days saying, "Seller, we've just got an email from the buyer's lawyer and their finance hasn't been approved- Yeah ... we've got to start again."

Understand. The,

the listing's gone stale on realestate.com three or four or six or seven weeks down the track.

They might have to spend more money upgrading the listing on realestate.com.au, and they've probably emotionally already spent the money from the settlement and, you know, it's just not a good situation to be in. So g- give, give the agent confidence that you can actually settle on, on what you're offering to, to buy the property for.

And, um, just going on that, you, you mentioned the timing there. Um, I guess as a buyer, we really wanna think about what the seller's thinking. Um, does timing play a big role in where the campaign is at in making an offer, or should you just go straight away? Should you wait a couple of weeks?

Yeah, good question.

It depends on the, the listing. It depends on the seller. It depends on whether the market is strong or weak If it's an auction campaign, it may well be that the a- if you work with the agent, it may well be that the agent might tell you, "Well, the owners are not going to consider an offer prior to auction," for example.

Okay. "Don't bother putting in an offer because it's a mortgage in possession sale, and they won't look at any offers before auction." In other scenarios, sometimes agents list a property even though they know that a seller might be wanting a little bit too high for it. And in some cases, the agent might assist you by saying, "Look, I don't think the owner is fair dinkum about the price at the moment.

Maybe you should hang off on making this offer for another couple of weeks when we've had the opportunity to provide the buyer feedback to the owner over a couple of weekends of open homes so they get a bit more realistic on the price. So don't put your offer in too early. Don't worry, you're not gonna miss out because they're a bit overpriced at the moment."

So work with the agent and a- ask for advice about submitting the best offer and, and the right timing for the offer. Okay.

So ask the right questions, uh, try to understand the seller, and work between yourselves to find out if you can get a deal done. That's really great, but how do we make sure that we're not overpaying for a property when we wanna make an offer?

Well, as I mentioned before, if you can't very, very clearly identify the differences between the most three comparable sales and the property that you're making an offer on, you're selling yourself short. So just don't go and make an offer unless you've done your homework, you've been through a few other open homes of properties that you, you, you know what they're priced at.

And you need, just like a valuer does, you need to be able to know the difference in comparable sales so that you actually have the confidence to go forward with a price and know that you're not paying too much. Have a top dollar and, and you ... It's just like going to an auction, even when the property's being marketed with a price.

Have a figure in mind and say, "Well, look, I'm not going over this amount of money. This is the top dollar we're going to offer." And if you're trying to get a bargain in a market like it is right now, it's going to be very, very difficult. So don't go in there trying to bargain hunt, because there's gonna be too much competition at the moment To get a massive bargain.

It's just not gonna happen. So be reasonably close to fair market value. Provide some information to the agent about why you're submitting an offer at that level. Explain to them, "The one down the road is only asking X, Y, Z, and these, these are the reasons why I'm submitting that offer." But if it's not within ballpark of the current market value, the agent, I can tell you now, is probably gonna go to the seller and say, "This guy's not serious.

Tell these people that we've rejected his offer, and they can come back down the track if they wanna increase their offer." But if it's a strong offer and it's close to fair market value, we as agents are probably gonna say to the seller, "Look, this guy's pretty close. I think we should negotiate with this guy because we don't wanna lose him to another property."

So keep that in mind. Think about how the agent is gonna respond to your offer when he's talking to the seller.

Okay, understand. So understand the market value. Be in the general range, what could be considered, uh, acceptable or at least negotiable. And, um, as a buyer, set your limit, know where you are, and, uh, choose the right, the deal that's right for you.

Absolutely. That's, that, that's all there is to it. Okay.

Uh, well, thanks for listening today to Selling Southport. Uh, if you're currently looking to buy or sell and want some guidance on how to approach the market, feel free to call Andrew at any time. He's always available on the mobile and happy to answer any questions.

Uh, if you've got questions about selling or making an offer, um, feel free to reach out on the phone or even in person. Um, he's a very approachable fellow, and he's happy to help. So, uh, yeah, just speak to him, and, uh, hopefully we can help.

Thanks for listening to the Selling Southport Podcast. I hope today's episode has given you some valuable insights and practical advice on the local real estate market.

Whether you're looking to buy, sell, lease, or invest, I'm here to share my extensive experience and guide you every step of the way. If you have any questions or want to discuss your next property move, don't hesitate to reach out. Your success is my priority. Stay tuned for more expert tips and updates on the Southport property scene