Questions To Ask A Real Estate Agent (Day 18)
Here are some questions to ask a real estate agent to get important information about any particular property, and to grow your confidence in dealing with real estate agents.
Hey and welcome to the 30 day property journey. Over the next 30 days I’m giving you some activities that you can do to boost your confidence and become a more successful investor.
It’s very important to get confident talking to real estate agents and asking them questions. The questions you ask real estate agents can help reveal why the owner is selling, put you in a better position to negotiate and it can help you identify problems with the property or potential opportunities.
Being able to ask a real estate agent questions and being confident around them is very important so I’m going to go through a bunch of different questions that you could potentially ask a real estate agent.
You could do it through email, you could do it over the phone, you could do it in person it doesn’t matter. I suggest that if you’re just getting started email is always the easiest way because it’s not very confrontational and then you can work your way up to phone or to in person.
It’s actually very easy to go into an open for inspection and hardly talk to the real state agent at all. You can duck in and duck out and be pretty well unnoticed. However, by asking questions you can really make yourself stand out and you can boost your confidence.
Going to an open for inspection is good and is going to boost your confidence but actually asking questions to the real state agent is going to do even more good for you.
I’m going to cover some pretty general questions in today’s episode. If you want a more advanced checklist on things you should be looking for when you’re actually inspecting a property well you can get that inside The Essential Guide To Buying Your First Property In Australia.
Some Questions You Can Ask The Real Estate Agent
Some of this questions may apply to you and some of them won’t. You’re not always going to get a straight answer from the real state agent with everything you ask but the idea is to ask these questions on a property that you’re not actually interested in buying so you don’t actually care if you get a satisfactory answer or not. You can begin to build your confidence and get used to asking these questions without the fear that comes with seriously looking to purchase.
I find that the first time you ask questions it feels like you sound silly when you’re asking. However, when you’ve asked the same questions a few times it just rolls off the tongue, it’s really easy and it’s not awkward at all.
So here are some questions:
Why are they selling?
You can ask the real state agent why the owner selling the property. If you can find out why they’re selling, this could give you potential negotiating power. Most real estate agents will try not to tell you this but if you can find out it is very useful.
Would they consider selling for less?
You can ask them if the owner is willing to negotiate. the real state agent might come back with a yes or he might come by with a no. This can be a good way to gage future negotiations.
What terms are they looking for?
Some owners who are selling and looking for certain terms with their properties. They might need cash within 30 days because they’ve actually bought another house.
By identifying what they actually have a need you can put yourself in a better position to negotiate against someone else. If you know they need cash in 30 days you can offer a shorter settlement and then they know they’re going to get the cash. Someone else might offer more money but a longer settlement and which wouldn’t work for the seller.
What’s wrong with the property?
See if they let you know anything. This is especially important to ask if the property is priced below everything else in the market or seems “too good to be true“. You could also ask them if there’s any ongoing maintenance issues.
How does the property compare to others in the area?
A real estate agent is unlikely to just be selling this one property. If you’re not interested in this property they’re probably going to want to sell you another property, so why not ask them how does this compare with other properties in the area? It might give them the ability to share with you some other properties that may be more suitable for you or may be better investments for you.
What are the body corporate fees?
If it’s a town hose, villa or unit you will likely have to pay body corporate fees. By understanding these fees you can work out what your cash flow is going to be.
Make sure to also ask how much is in the sinking fund.This is related to body corporate – this is how much money they have stashed away for major improvements or major renovations to the common areas.
What would this property rent for?
Just say “I’m an investor and I need to do my cash flow analysis before considering making an offer on this property. What do you think would be the potential rent for this particular property?”
It’s a great question to ask because you can then go and do a cash flow analysis on the property and you can see whether the property is going to be positive cash flow or whether it is going to be negative cash flow.
Here are some more questions you can ask:
- Can I please have the minutes for the last 12-24 months for the body corporate?
- What do you see as the opportunities on this property?
- What are renters looking for in the area?
- What are investors looking for in the area?
- What is really popular in this area?
- How quickly do properties sell in this area?
- Do properties generally get discounted?
- Is the owner willing to offer owner finance?
As you can see the are so many different things that you can ask and the goal is not necessarily to get an answer to the question that you’re asking or to ask an specific question, but it’s to get used to talking to real estate agents and asking them questions. It’s about becoming confident with that process of the buying cycle.
You can do this by email – simply go on realestate.com.au find a property and then just simply fill out the contact form and ask one of this questions in the contact form
You could call a real estate agent – ask them “look I’m an investor I’m just wondering how much would this rent for?”
Or you could go to an open house and speak to them there – that is something that you should do if you want to become a more confident investor.
Alright, tomorrow we’re going to go into the statistics of the back of a property magazine. Why they’re so useful and how you can use them so that is going to be a fun activity that we can do tomorrow. It’s actually a really easy activity as long as you have a property magazine. It can actually help you find positive cash flow properties as well which is pretty exciting
Until tomorrow, remember stay positive!