Rush for Perth property leading to poor buying decisions

The relative affordability of WA property and the potential for strong yields has made the state very attractive to investors – both local and interstate – over the past few years.

However, the market is highly competitive and the challenges of finding a property have seen more investors choose to use a buyers agent.

When engaging the services of a buyers agent, you would assume you are dealing with a qualified, licensed professional. That isn’t always the case.

The growing demand for buyers agents services has led to a rise in poorly trained and unlicensed operators, often based interstate and overseas, who promote themselves as buyers agents in WA.

You can usually find them spruiking their wares on investment-related Facebook pages. They have professional-looking websites and social media profiles and look like the real deal.

In June, the Real Estate Buyers Agent Association of Australia (REBAA) launched a campaign to warn consumers about the risks of working with underqualified buyers agents who lack fundamental skills in due diligence, pricing analysis and negotiation.

While newcomers to the industry are welcomed and encouraged, REBAA President Melinda Jennison said, “Many new buyers agents enter the industry with only a superficial understanding of its complexities, putting themselves, and the clients they are representing, at risk of making uneducated and costly decisions”.

REIWA supports these concerns. We are also concerned about the risk to investors of working with unlicensed buyers agents and have raised this issue with WA Consumer Protection.

REIWA has previously written about the importance of using a WA buyers agent if you are buying in WA. Aside from their knowledge of the local market and legislation, when you engage a WA buyers agent you also have the advantage of dealing with someone who is licensed under the Real Estate and Business Agents Act 1978. This gives you peace of mind as well as protections under WA consumer law.

While I strongly advocate for using a local buyers agent, there is nothing wrong with using an interstate buyers agent to buy property in WA. If you do, make sure you are using a qualified, licensed professional.

If you are looking to invest in WA and are planning to engage a buyers agent, there are some important things to consider.

Is the agent is licensed to operate in WA? WA agents must be licensed and you can check this at Consumer Protection. You can also check if interstate agents have had their licenses recognised via the Automatic Mutual Recognition Register.

What training have they had? Be wary of agents that have just done a short online course. WA agents have to complete a registration course initially and then undergo continuing professional development. If you are engaging a WA buyers agent, are they a REIWA member (as such members must be licensed).

You should also ask how long the agent has been in the industry, how many buyers have they successfully helped, and whether they provide references you can contact.