Consumers should steer clear of any “free” buyers’ agent services offered during the purchase of their next home or investment property, according to the Real Estate Buyers Agents Association of Australia (REBAA).
REBAA President Melinda Jennison said buyers’ agents always charge a fee for their professional services as well as work exclusively for the purchaser.
“Recently, a ‘free’ buyers’ agent service promotion was emailed to me, which had been targeted to mortgage brokers from a development marketer by the look of it,” Ms Jennison said.
“Not only did it offer free supposed buyers’ agent services, but also it insinuated that brokers could increase their income substantially if they added this service to their businesses.”
Ms Jennison said the promotion was not an uncommon tactic used by property spruikers, whose main objective is usually to sell inferior developer stock.
“The use of the term ‘buyers’ agent’ as well as the addition of some mainstream media logos is an attempt to give the business legitimacy, when in fact what they are offering has nothing to do with buying a property and everything to do with selling one instead,” she said.
“Let’s never forget that free advice is often more expensive than paying for the advice upfront – especially if a buyer is offered this free buyer’ agent service from a trusted practitioner, like a mortgage broker, accountant or financial planner.”
Ms Jennison said it was vital that buyers always consider if any party to a property transaction has a vested interest in the outcome.
“Why are they wanting to act for you for free? Usually, it’s because they want you to buy developer stock or take their fee from the vendor – which is hardly exclusive or independent advice,” she said.
“Essentially, these ‘free’ buyers’ agents are selling agents in disguise. They have a huge financial incentive to help you buy that property and that’s not necessarily in the buyer’s best interest.”
Consumers should carefully check the credentials of any buyer’s agent and confirm they are appropriately licensed in the state or territory where the property is being purchased and that they act ‘exclusively’ for the buyer, Ms Jennison said.
“Buyers should also ask questions about their experience, time in the industry, research methods, relevant industry body membership status including if they are a REBAA accredited member, as well as how they are paid and by whom.
“This will help to identify individuals or companies who present themselves as buyer’s agents to consumers but do not offer the same level of service as a professional provider.”
When relying on professionals such as mortgage brokers and accountants, consumers should feel confident in their professional relationships and trust that recommendations are made with their best interests in mind, rather than being influenced by commissions or financial gain from suggesting property options, Ms Jennison said.
According to the 2024 PIPA Investor Sentiment Survey, investors generally seek property investment advice from buyers’ agents and advocates, mortgage brokers, accountants, and qualified property investment advisers.
“Regardless of where consumers find their property investment information, it is vital that they only ever work with professionals who are appropriately licensed, independent, and who are working exclusively for the buyer,” PIPA Chair Nicola McDougall said.
“Free advice has long been the domain of spruikers, with this latest marketing ploy just another example of unscrupulous operators seeking to profit from unsuspecting property buyers.”
ENDS
For more information or to organise interviews with Ms Jennison contact:
Bricks & Mortar Media | media@bricksandmortarmedia.com.au
