I am by no means a property expert. Far from it. It’s just something I love a dabbling in and so thought I’d comment on a few properties I have bought recently and how I secured them. There are so many strategies and schools of thought when it comes to buying property. Finding “off market” properties and seeking out “distress sales” are two that I have used.

Off Market: Bondi is a highly sought after suburb with great yields. I believe it’s always going to be in demand and is a pretty safe bricks and mortar investment. Because of this, and despite the fact that one of my favourite things to do is cram as many house inspections in on a Saturday morning, I generally use a buyer’s agent to find an off market property. I simply don’t have the time to build relationships with every real estate agent in the area.

Off market or silent sales are those listings that are never advertised to the public. These generally come from vendors that don’t want to spend the money on advertising, don’t want the stress of an auction, want to sell quickly due to a death or divorce or are keen for a quick deal at the right price. Real estate agents know that buyer’s agents have ready purchasers, which often leads to a quick sale. The last property I bought in Bondi was exchanged within 12 hours of me hearing about it. I knew the market extremely well, I trusted my buyer’s agent – Chris Gray from Empire (chris@yourempire.com.au) implicitly and I surrounded myself with my expert team – mortgage broker, private banker, solicitor and accountant. Happy days!

Distress Sales: The second strategy I have used lately was, to be honest, quite accidental but I do love a deal and a good game of negotiating which led me to two distress purchases. In January I found a property that actually didn’t quite fit the strategy of what I was looking for at the time. I’ve become pretty good at not making emotional purchases so whilst I loved the feel of the property, I felt it was too small and didn’t meet my stringent list of requirements. I literally got half way through the property and walked out before my emotional attachment had time to kick in.

As I was leaving, the agent mentioned to me that the vendor was desperate. He had exchanged with another party and based on that he had overextended and bought another much more expensive property. The deal fell over after the purchaser’s finance was knocked back. I made a ridiculous offer on the spot and picked it up $85k under what the vendor had originally exchanged at. I got the vendor out of some potentially hot water and bagged myself a great deal.

I had just returned from my 11th trip to Byron Bay/Bangalow in as many months. I’d been looking at property up there just for fun for a few years but had always made a firm commercial decision not to buy as the yields weren’t great among a number of other reasons. However, on returning to Sydney, some power greater than myself led me to dialing into Domain. The first property that popped up was in Bangalow and had an instant mesmerizing hold over me (you might remember the gut feel and intuition I talked about in my previous post).

 Now I hadn’t even settled on the abovementioned property so wasn’t really in the market for another. This non-emotional attachment was the perfect cornerstone for the deal. I noticed they had a big fat sign of a major price reduction and after a little internet surfing, it didn’t take much to see the property had been on the market for 18 months and with three different agents. I also knew that property just hadn’t been moving in the area for a couple of years. So, with nothing to lose and absolutely no emotional attachment to the outcome, I made a cheeky offer $326k under asking price (without talking specifics I offered around a third under).

The real estate agent informed me that the vendor was offended to which I simply said that she was absolutely under no obligation to accept my offer and I was absolutely not in a position to offer more. Life is about choice, so if you ever do this (if properly informed of current market situation) I don’t think you should feel bad. I then sat on my offer unemotionally for six weeks – (not an easy task for an instant gratification junkie but a great lesson in patience and detachment) and watched the price drop and drop and drop. The end result was that I ended up getting it for just $9k above what I had originally offered and $317k under their original asking price.

These deals are often not so easy to come by but I found two in as many months so they are definitely out there. All I can say is educate yourself on all aspects of the area you are buying in and surround yourself with an incredible team of advisors who know exactly what they are doing.

I might sometimes do quick deals and base them on gut, but we do have that 5% of number crunching, stats and strategies backing me all the way. Have fun xx Lisa