How to tell if a buyer is genuine

Have you been to an open for inspection recently?

In the current superheated market and with interest in real estate at an all-time high, a 30-minute open for inspection can see hundreds of potential homebuyers wander through a property.

So how do you know which of those people are genuinely interested in purchasing?

Here are some of the major telltale signs.

They’ve got finance

Former agent and now managing director of Parley Property Advisory, Luke Assigal, says you can sort the wheat from the chaff straight away by determining which buyers have organised their finance and are ready to purchase.

Those who haven’t been approved for finance might be weeks or months away from being in a position to buy, or may never be approved for a loan at all.

“One major danger is if clients don’t have finance,” Assigal says. “There’s experiences where they (buyers) waste our time showing them through numerous properties and then we realise they don’t have finance.”

They ask more questions

Assigal says truly interested buyers will ask specific and targeted questions that casual sticky beakers wouldn’t bother with.

“The buyer will normally ask more questions around the terms of the contract, if the vendor will sell prior and more detail about condition of the property,” he says.

Displaying over-the-top disinterest

It’s the oldest negotiation trick in the book: pretend you hate something you really love.

Assigal says buyers who go out of their way to point out the property’s flaws are usually the most interested in it.

“Funnily enough, when they seem to hate the property and tell you how bad it is, sometimes, depending on the questioning, it just shows that they like it.”

“Twenty-four hours later they’d put an offer in.”

“It’s a kind of negotiating tactic. You need to have bargaining power when you negotiate.”

Timing is everything

It doesn’t take an expert to work out that a buyer isn’t likely to emerge from the large group of people who view the property for the first time at the final inspection on the day of the auction.

But Assigal says the timing of their first inspection can be a key indicator of their intentions.

“Generally interested parties, especially in an auction campaign, they’ll come through in the first week to two weeks,” he says.

“It’s an interesting fact – we were monitoring it when we were selling, and 90% of buyers that come through in the first two weeks were the ones that actually bought it at auction.”

“It just shows that when you’re in the market and you’re looking, you’ve got your finger on the pulse, so you generally come through in the first week and then come (again) in the second week, and then prepare yourself for auction.”

“In any campaign the first two weeks are imperative.”

Assigal says truly interested buyers will also spend a lot of time at the property and will almost always come to more than one open for inspection.

Disregard contract requests

While requesting a contract of sale was once a major pointer to someone’s intention to buy, Assigal says that’s no longer the case.

“That’s 10 years ago,” he says.

“These days you’ll find on campaigns you’ll have 20 people ask for a contract of sale and only have two offers. Back in the day that used to show interest, but not anymore. Everyone just wants to have a sticky beak.”

For more information click here.