If you’re a property owner, investor or looking to get into the market The Rentvesting Podcast will help cut through the hype, look at the facts and draw on decades of experience to help you make smarter property decisions.
Aug 5, 2017
This week, we’ve got Kevin Turner as a special guest, industry veteran and host of Real Estate Talk Podcast. He has been in the industry for over 30 years, and more importantly, he’s seen a lot of deals.
We run through his tips on the art of negotiation when dealing with real estate agents and a few tricks of the property trade including:
I’ve been in real estate since 1988, and I’ve seen a lot of tough times. I’ve been a real estate agent as well as an investor and my background is broadcasting. Having been in radio for quite some time, I combined those two careers, I’ve still got a licence but I haven’t sold in quite a few years.
I wouldn’t call them tricks that agents use, but there are negotiations strategies. Real estate agents work for the seller and they’re there to get the most they can for them, but first home buyers look at it in an emotional sense. Agents try and make you proceed with early offers, so make sure you go in with a plan, think about how much you want to spend and stick to it. The bottom line is that there’s always another property. Don’t get caught up, as if this is the only property, think of it as a commercial exercise.
That’s the secret.
Don’t get caught up in commentary and emotion, and plot your own path.
If you are going to into the market as a first home buyer, get help from a buyers agent and even consider taking a negotiation course so you learn how to hold the high ground.
Well, this means you’re buying at a good time, but you could be caught in it. This goes back to understanding the true value of it and being prepared to pay what you want. There is a requirement where if there’s a competitive offer, the real estate agent can't show you the offer. But good agents will get you to sign a competing offer form and you can make your best and final offer, then if you miss out on it, walk away and don’t get caught up in the emotion of it.
You make money out of real estate when you buy, not when you sell. Don’t pay extra when you buy, because you can't expect to make up for it when you sell.
What are your thoughts on ways people can arm themselves against recession because you can't go up forever?
I remember when mortgage rates were 18% that was hard. Plan for the best but expect the worst. Rates will go up they cant be the lowest they’ve been forever that scenario will change. The banks build a buffer whenever you borrow, so make an allowance for rates to change up to 5%.
Make the sacrifices early in life and be prepared to go without, a lot of smart young investors that I meet and talk to are happy to go and rent in a place they like to live in but invest where they know will go up (Rentvesting_
Smart investors also understand that having a plan is set and has a strategy behind it, whether you’re looking for capital growth or turning it over.
You also need a team of experts around you, buyers agent, good accountant, real estate agents, tax accountant. When you’re starting to build a portfolio you need to have the right tax structure, think about your plan and your team and build it as soon as you can.