Buyer’s agent Jack Freestone said off-market and pre-market sales were becoming a ‘go-to’ option for buyers dealing with price uncertainty and high competition. (Source: Supplied\/Getty) <\/p>\n
One in five Australian properties<\/a>, or about 100,000 each year, are estimated to be sold off-market<\/a> before being listed on major property platforms like Domain and realestate.com.au. The trend has been growing in popularity amongst buyers as competition intensifies<\/a> and properties are snapped up before their first open home.<\/p>\n Properties<\/a> are selling around a week faster than the decade average, Cotality data found, with the average property on the market for 29 days across the country. Total listings<\/a> are now 18 per cent below their 10-year average, while auction clearance rates are sitting at 70 per cent across the major cities.<\/p>\n Brisbane buyer\u2019s agent Jack Freestone of Buyers Collective told Yahoo Finance fierce competition<\/a> was leading more buyers to turn to off-market and pre-market sales.<\/p>\n RELATED<\/p>\n \u201cAs soon as something basically gets listed, there\u2019s multiple offers. A lot of the time, a minimum of eight to 10 written offers on each property and they\u2019re sold before the first open home or the day of the open,\u201d he said.<\/p>\n Freestone said the expanded First Home Guarantee scheme<\/a> had brought more confidence into the market among first-home buyers, which has also increased competition and driven prices up<\/a> in certain segments. In Brisbane, the upcoming Olympics has also driven higher demand.<\/p>\n Freestone said at least 70 per cent of purchases the buyer\u2019s agency does were now either off-market or pre-market.<\/p>\n The Real Estate Buyers Agents Association of Australia (REBAA) estimates up to 20 per cent of properties nationwide are sold off-market, however, the group noted accurate figures were hard to come by, given the private nature of the transactions.<\/p>\n Do you have a story to share? Contact tamika.seeto@yahooinc.com<\/a><\/p>\n REBAA president Melinda Jennison noted the \u201cmarket mismatch\u201d was pushing property prices higher<\/a> and underpinning the pivot to off-market properties by increasingly \u201cdesperate\u201d buyers.<\/p>\n \u201cWhen you have stronger sales activity but significantly lower listings available, it\u2019s clear that more homebuyers and property investors are seeking off-market opportunities in an attempt to secure their next homes and investments,\u201d she said.<\/p>\n Private real estate marketplace QuietList, which runs a subscription platform for real estate agents, found more than one in every five homes sold in Sydney in the last year did so without being listed online.<\/p>\n Story Continues <\/p>\n Freestone said there were various reasons why a seller might want to sell their property off-market, including if they wanted to avoid marketing costs<\/a>, the ability to negotiate better terms, and personal reasons like the property being sold following a divorce or an older seller who didn\u2019t want open homes.<\/p>\n It costs as much as $5,000 to list a home on realestate.com.au, depending on the area. This price has risen dramatically, with a listing costing just $75 in 2009.<\/p>\n In May this year, it was revealed REA Group was being probed by the competition watchdog into its pricing practices.<\/p>\n Freestone noted buying off-market could have major benefits for buyers, including price and terms<\/a>.<\/p>\n \u201cUsually, you’re able to go through the property, you’re able to inspect the property, do all your due diligence up front, without the competition there,\u201d he told Yahoo Finance.<\/p>\n \u201cIf it is a property of interest that you’d like to try to secure, you’re able to formulate and strategise and offer to be able to secure that property without the competition, without other offers flying in over your shoulder and driving the price up.\u201d<\/p>\n Proptrack, which is part of REA group, found properties that sold off-market sold for 4.3 per cent less than those that had been listed on its website. This translated to a loss of more than $60,000 in Sydney and nearly $30,000 in Melbourne, according to the 2023 research.<\/p>\n For buyers, Freestone said he didn’t see any downsides to buying off-market so long as you do your due diligence<\/a> and research into the market.<\/p>\n \u201cJust make sure you do your due diligence upfront before going to contract,\u201d he said.<\/p>\n Freestone said it was possible for buyers to find properties off-market without enlisting a buyer\u2019s agent, but it would be more time-consuming. This can be done by contacting real estate agents in the areas you are looking at regularly.<\/p>\n \u201cThey need to touch base with every agent you know, at least, you know, a couple times a week, if not daily, to check in and see if they’ve got a new property that’s coming up,” he said.<\/p>\n \u201cReal estate agents are constantly talking to homeowners and investors and trying to get new listings. And that can change day by day.\u201d<\/p>\n Buyer\u2019s agents will typically charge a fixed fee or a percentage fee, which can be between 2 and 3 per cent depending on the agency.<\/p>\n Freestone said there were also practical steps buyers could take to strengthen their position in the market, including having finance fully approved, being clear on non-negotiables, and moving quickly when the right property appears.<\/p>\n Get the latest Yahoo Finance news – follow us on Facebook<\/a>, LinkedIn<\/a> and Instagram<\/a>.<\/p>\n REBAA said there was a market mismatch underway as more buyers pivot to off-market property. (Source: AAP) <\/p>\n