One of the tricks is being able to find a property before it even hits the market. How do you go about doing that, and how do you make sure that you’re not paying too much? Today we talk with Ben Kingsley, the CEO and founder of Empower Wealth.
Kevin: Ben Kingsley joins me once again. Ben, of course, is the CEO and founder of Empower Wealth. They specialize in finding the best buys for their clients no matter where they are in Australia.
One of the tricks is being able to find a property before it even hits the market. How do you go about doing that, and how do you make sure that you’re not paying too much?
Ben: It’s a good question, Kevin. I remember when I was 23 years old and I was just getting into the property space. I actually did a letterbox drop around the area that I identified that I wanted to buy in. I can tell you that I dropped about 600 pamphlets into different letterboxes, saying, “I want to buy your house,” and I had two people call me and say, “Who are you? What do you do?” That’s the hardcore approach.
There are a couple of hardcore approaches. The first one is that letterbox drop, and the second one, which is a little bit more adventurous, is looking at family courts and seeing some of those divorce settlements going through. Those usually result in a sale transaction of the family home.
They are certainly some more adventurous ways, but the traditional way that you’re going to find off-markets and what we call pre-markets is just talking to the agents in the area. Ultimately, they’re the ones who are still going to have control of the majority of buyers who are coming to the marketplace.
What I talk about when I say a pre-market sale is I’m talking about the agents who are just about to bring a listing on, or they’re just signed up, and the boards haven’t gone up, and the photos haven’t been taken. Usually in those cases, the agents will allow seasonal buyers such as buyer’s agents and the like the opportunity to go through the property, or they might have also a VIP list of clients ready to buy that they send through the property.
You don’t want to be a stranger to the local agents in the area that you’re looking to buy in. It doesn’t necessarily mean you have to tell them exactly what price you’re ready to pay – we need to keep some of our tricks up our sleeve – but ultimately letting them know that you’re an active buyer in the area is really important.
Kevin: It’s long-term, isn’t it? I talked there in the title about trying to buy a property before it actually hits the market. I guess, there’s no such thing really, because it only ever hits the market when you have a willing seller. I guess the trick is to be there when they make that decision.
Ben: Yes, it is. Ultimately we still hear stories about people getting an opportunity to buy the property down the road because they know the local neighbor or they’re involved in the golf club, or the RSL, or something like that. Someone wants to sell the property, and they’re thinking, “I’ll cut the agent out of that conversation.”
But in terms of those properties, those transactions are very small and few and far between. The reason for that is if I was wanting to sell my property, I want to get the best price possible. Usually the best way to do that is to get a marketing campaign behind me. It’s not easy to sell a secret, so you want to get the message out there to market.
Coming back to the point I was making, if you really show that you’re a keen buyer in a particular market, and you’re talking to the local agents in that area, they’ll get you through a property very quickly, because they also want to show their vendors that they do have buyers ready to go.
Kevin: The great agents, no matter where they are, will be very quick to tell you that listings don’t just come on and they get them; they actually put a lot of time and effort into getting them well before they come onto the market. You just have to be patient, do your homework, and as you said, spread that network far and wide.
Ben: That’s right, Kevin. Once you identify the area that you want to buy in – coming back to the point we made – it is about talking to those agents, and finding those agents that have got the most listings, and building a relationship with them to see when the right asset does come up, you can strike at it.
Kevin: Ben Kingsley from Empower Wealth. Thanks for your time, mate.
Ben: Pleasure, Kevin.