{"id":8713,"date":"2016-08-03T01:00:41","date_gmt":"2016-08-02T15:00:41","guid":{"rendered":"http:\/\/realestatetalk.com.au\/?p=8713"},"modified":"2016-08-03T01:00:41","modified_gmt":"2016-08-02T15:00:41","slug":"the-little-white-lies-and-what-they-mean","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/the-little-white-lies-and-what-they-mean\/","title":{"rendered":"The little white lies and what they mean – Shannon Davis"},"content":{"rendered":"

 
\nIn our feature interview this week, we take you through the little white lies you might hear from time to time as a buyer. \u201cThe owners are expecting an offer\u201d, \u201cThe seller has not set an expectation\u201d \u2013 in fact there are 8 that Shannon Davis<\/strong> has been able to identify as he talks about what they mean and how to react to them.
\n <\/p>\n

Transcript:<\/strong><\/h4>\n

Kevin:\u00a0 <\/b>Now at the outset, I have to say no one is suggesting that real estate agents tell lies, but occasionally, I guess you can say they do get a bit creative with the truth. It\u2019s not just real estate agents; I guess anyone in a selling role sometimes has to maybe sidestep around what\u2019s really happening to try to get a sale across the line.
\nI\u2019m not going to sit in judgment, I don\u2019t want you to sit in judgment, either, but the thing that I want to discuss now is some of the \u2013 I guess \u2013 white lies that real estate agents actually tell. Someone who has the antenna up all the time is Shannon Davis, who is a buyer\u2019s agent. You are a real estate agent, but you\u2019re a buyer\u2019s agent, and you probably come across this quite often, Shannon.
\nThank you for your time.
\nShannon:\u00a0 <\/b>No worries, Kevin.
\nKevin:\u00a0 <\/b>Let\u2019s have a look at a few of these. You\u2019ve identified eight for me, and I just want to talk to you about each one of these. When an agent says to a buyer \u201cHey, we have another interested party,\u201d what do you say about that?
\nShannon:\u00a0 <\/b>Yes, that\u2019s a good one. People are more motivated by losing things than gaining things, so its aim is to create some urgency for someone to take action. That may be true or perceived, but whatever the case, in any negotiation, it\u2019s a battle for time, information, and power.
\nI think the buyers need to know that they can walk away, there are other properties out there, whereas the seller only has the one to sell. I think power can be a perception, and it\u2019s not always with the seller. If they have another party and you\u2019re getting the urgency put on you, you need to make sure what your role is and whether you\u2019re worried about losing the property to someone else. Make up your own mind from there, and perhaps call the bluff if you\u2019re not quite ready to take action.
\nKevin:\u00a0 <\/b>Let\u2019s talk about calling the bluff. How do you do that, and how do we find out if there is another interested party? Most people are interested\u2026 Anyone who comes to an open home is an interested person, let\u2019s put it that way, but how interested are they? Are they prepared to buy it? How do you find some of these things out?
\nShannon:\u00a0 <\/b>Yes, I think questions are key. Strive to be innocent. Think of Columbo if you can. He used to always ask those silly little annoying questions, and the more questions you ask, the more information you garner.
\nThat brings us to the next one, which is \u201cWe\u2019ve had an offer.\u201d You need to dig a little bit deeper to see if that offer is written, if it\u2019s on contract, or if it\u2019s just a verbal, and then you can gauge your reaction after that.
\nKevin:\u00a0 <\/b>Yes. You can ask, but you\u2019re probably not going to get an answer about the level of the offer, are you?
\nShannon:\u00a0 <\/b>No, but it doesn\u2019t hurt asking. There are all types of agents out there \u2013 inexperienced ones, ones who just work with buyers, there are seasoned pros \u2013 so it doesn\u2019t hurt to ask.
\nKevin:\u00a0 <\/b>Yes. You\u2019ve highlighted it there. You have to ask whether that offer is in writing or whether it\u2019s verbal. The difference between the two, Shannon?
\nShannon:\u00a0 <\/b>Well, a person putting things in writing\u2026 Business is done in writing. Verbal can be any sort of reaction, and it\u2019s no interest to the sales agent until we see something that\u2019s in writing, but even better if it\u2019s in a legally binding contract. That\u2019s when we know that we have genuine interest. Everything else is all irrelevant.
\nKevin:\u00a0 <\/b>I guess in all of these conversations we\u2019re having \u2013 and we have a number to get through yet \u2013 you have to understand that the agent you\u2019re talking to is actually representing the seller, so most of the conversation that they have with you is going to be couched <\/b>in terms of the benefit to the seller, not to you as the buyer.
\nShannon:\u00a0 <\/b>And that\u2019s what we need to worry about. If you\u2019re representing yourself, it\u2019s buyer beware, and no matter how friendly, charming, charismatic the agent is, they\u2019re not your friend; it\u2019s a person working for someone else.
\nKevin:\u00a0 <\/b>The next one is a bit unusual, where an agent would say, \u201cWe haven\u2019t had as much interest as we\u2019ve anticipated.\u201d Why would they say that, and what can we read into that?
\nShannon:\u00a0 <\/b>This is designed for the bargain hunters. Maybe there\u2019s an auction approaching and they want to draw as many people to the crowd as they can, and they\u2019re signaling a weakness on the other side. They want to try and encourage any action to what may be a stale listing, and something like that will get the bargain hunters motivated, and perhaps on the premise that they might get a decent purchase. But of course, when you turn up to auction, you might see that it\u2019s overflowing with people who are there and maybe you\u2019ve been had.
\nKevin:\u00a0 <\/b>Yes. Getting back to the comment you made earlier about asking questions, those Columbo questions \u2013 and I love that. He was very good at that, wasn\u2019t he? Right at the end, he\u2019d just come back.
\nShannon:\u00a0 <\/b>Very good. I loved Columbo.
\nKevin:\u00a0 <\/b>A really good question to ask there is if an agent says to you \u201cWe haven\u2019t had as much interest as we anticipated,\u201d it would be great to say \u201cWhy do you think that is?\u201d
\nShannon:\u00a0 <\/b>Yes, definitely.
\nKevin:\u00a0 <\/b>Just to see what the agent comes up with.
\nShannon:\u00a0 <\/b>Questions such as days on market, vendor motivation, maybe the negatives that you put up in the property, just to see what the other interest has been and what the agent feels about those objections.
\nKevin:\u00a0 <\/b>It comes back to having a lot of knowledge, and you mentioned about days on market and success rate, understanding what\u2019s happening on the market. If you push that back to the agent and show them that you know what they\u2019re talking about, you\u2019re less likely to cop some of these little \u2013 as we call them \u2013 white lies.
\nShannon:\u00a0 <\/b>Definitely. You look to be serious, you look to be informed, and you\u2019ll probably get good oil, rather than being treated like a person who may be had.
\nKevin:\u00a0 <\/b>Yes. We have a number of others to get through. The next one you highlighted for me was that the vendor wants contracts signed up tonight. What are they implying there?
\nShannon: \u00a0<\/b>Time is a really big thing in negotiation, and often, the seller will try to move the time. Maybe they\u2019ve bought elsewhere, or maybe they have an impending overseas visit. We need to push back to see whether that deadline is real or just made up, and if you\u2019re not in a position to sign \u2013 perhaps you haven\u2019t been to see your bank, or your significant other hasn\u2019t been through the property \u2013 it\u2019s just one of those things that\u2019s designed to create urgency. So if you\u2019re not in a position, just push back on that.
\nKevin:\u00a0 <\/b>Yes. I guarantee that if I went to any seller, any vendor and said \u201cWould you like a contract tonight,\u201d they\u2019re all going to say yes. So that in itself is just a statement; it doesn\u2019t really mean much. Every seller wants a contract, don\u2019t they? That\u2019s why they\u2019re on the market.
\nShannon:\u00a0 <\/b>That\u2019s right, and we need to just concern us with ourselves and control what we can control. It goes back to that perception of power. Sometimes yours is the power, because you can walk away.
\nKevin:\u00a0 <\/b>The next one I love, and this one is going to come up all the time, especially with auctions, where the agent will say, \u201cWell, the vendor hasn\u2019t really given us a good indication of their expectation.\u201d I would imagine this would be on the tail end of \u201cHow much do they want?\u201d That\u2019s the question I would ask the agent.
\nShannon:\u00a0 <\/b>Yes, definitely, and if you think that any vendor has signed up an agent to represent them without giving an indication of their price expectation, you believe that pigs can fly. Of course, they\u2019ve given an indication, but what the agent is trying to do is solicit your highest price without putting a range into your thinking. The better question probably is \u201cWhat comparative sales have you got to justify the price point for this property?\u201d
\nKevin:\u00a0 <\/b>Because in fairness, there are some parts of Australia \u2013 Queensland being one of them \u2013 where the agent is not allowed to give you an indication on price, and that\u2019s in legislation. So I guess you have to be a little bit wary about that, don\u2019t you?
\nShannon:\u00a0 <\/b>Yes, but they do have an obligation to give comparative sales, too. So while they can\u2019t put a price in your head, there\u2019s nothing stopping them talking about that.
\nKevin:\u00a0 <\/b>Yes. Next one: \u201cWe\u2019re happy to present any offers prior to auction day.\u201d This is a tough one, because a lot of buyers actually to try to avoid going to the day of the auction, so they will actually try and put their best foot forward, but in doing that, they could actually be making a very big negotiation mistake, Shannon.
\nShannon:\u00a0 <\/b>Yes, they may be even raising the reserve. Because they\u2019re so genuinely, emotionally tied up with the property, they\u2019re showing their cards before they need to. I think in trying to avoid the contest, they\u2019ve really given all the information to the other side, which is never a good idea.
\nKevin:\u00a0 <\/b>Yes, not a good idea at all, so that\u2019s one. Do you try to buy properties before auction day?
\nShannon:\u00a0 <\/b>When it is a property not attracting the offers. If it was a property with little developer interest and perhaps no owner-occupier appeal but has a really good commercial location and there\u2019s a property that would fit us, I can garner that it\u2019s not going to be a strong appeal to most people and perhaps the vendor is a little bit desperate. That\u2019s when we would try and secure something prior to auction, not the other way, when it\u2019s obvious high demand and going to be well contested. It\u2019s just showing your cards before you need to.
\nKevin:\u00a0 <\/b>Okay, the next one is really I guess where you\u2019re at the point of going to contract, and the agent says to you, \u201cWell, you don\u2019t really need a solicitor looking over this. Just sign it. It\u2019s a standard contract.\u201d Not a good idea?
\nShannon:\u00a0 <\/b>Never a good idea with that one, because people shouldn\u2019t talk beyond their qualification and an agent has no legal qualifications there. Every real estate transaction should have the advice of a solicitor, and it\u2019s actually stipulated in the contracts, as well, so that would be quite a disreputable agent who would suggest that.
\nKevin:\u00a0 <\/b>Yes, any agent who does suggest that, just disregard them, and make sure you do contact your solicitor, because it needs to be done. I guess this next one is in a similar vein, too, where you may want something put into a contract, and it says \u201cWell, we don\u2019t need a special condition on this; the vendors are going to be fine with that one.\u201d That\u2019s a big mistake.
\nShannon:\u00a0 <\/b>Definitely. Business is done in writing. It needs to be done. Don\u2019t go to settlement where it then becomes your problem. You need to make that a condition of sale, so that it\u2019s all stipulated and agreed to before the settlement date.
\nKevin:\u00a0 <\/b>Yes, another great reason why you should be consulting your solicitor and getting your solicitor to draft that special condition.
\nShannon:\u00a0 <\/b>Definitely, take it out of the hands of the agents, and the solicitors can work to that themselves.
\nKevin:\u00a0 <\/b>Easy to see why you are so good at what you do, Shannon Davis from Metropole Properties. Thank you very much for your time, Shannon, for sharing your wisdom with us and enlightening us on a number of those points. Thanks for your time, mate.
\nShannon:\u00a0 <\/b>No worries, Kevin. Any time.<\/p>\n","protected":false},"excerpt":{"rendered":"

  In our feature interview this week, we take you through the little white lies you might hear from time to time as a buyer. \u201cThe owners are expecting an offer\u201d, \u201cThe seller has not set an expectation\u201d \u2013 in fact there are 8 that…<\/p>\n","protected":false},"author":176692471,"featured_media":8714,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[32,10,11,13,36,17,23,25],"tags":[101],"class_list":["post-8713","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buying-a-property-topic","category-kevin-turner-sponsored-channels","category-kevin-update","category-latest-story","category-property-investment-topic","category-property-investment","category-selling-a-property-topic","category-sponsored-channels","tag-podcast"],"yoast_head":"\nThe little white lies and what they mean - Shannon Davis - 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