I received distressed calls from consultants in the finance and property industry often, to rescue their clients who are about to get into trouble. These consultants care. They know that their clients need help in property buying.
When people are in love, it is hard to stop them loving. This includes properties that they have fallen in love with and you know that they are buying for emotional reasons. As a buyer advocate who protect property buyers, we have developed our own grading system and standards to assess properties. Hence, many properties will not come into our radar unless they possess intrinsic value. And we are not even talking about price.
Love is blind, they say. So are buyers who cannot control their emotions. To be fair, good value property buying is not an simple task. Many buyers are time and resource poor. When faced with the challenge of a rising market where prices are increasing by the $10,000s per week, they succumbed to pressure. When you are under pressure, you do not make the best decisions.
I was sent in by a solicitor to assist a buyer who wanted to buy this 3.5 bedroom house in Caulfield North on an allotment of 397sqm, right in front of a busy road, the tram tracks and just metres from the train tracks. I would only pay $1.3 million for it at the most, and my real estate agent mates agreed. The buyer also agreed, as that is already stretching her budget. The bidding started at $850,000 and the pace was slow. But once it hit $1.2 million, the bidding frenzy started. New bidders jumped in to fight for this 133-year old free-standing Victorian home. I stopped at our agreed ceiling price. When the bid hits $1.5 million, my buyer wanted to reenter the bidding war but was intercepted by me. She was crying. She felt like her lover being snatched by another person. She wanted to join in the fight, but with no more money in the bank. This is unwise. You do not buy something you cannot afford. In the end, the hammer fell at $1.63 million. We adjourned to a café and debriefed. The 3% stamp duty surcharge for non-resident buyers starting today have prompted my buyer to act irrationally. Luckily her best friend was there to put some sense into her. Otherwise, she would be in financial stress, or worse. “Thank you for looking after her, Erick,” said her best friend, “Luckily she has you by her side.”
Another day, another buyer saved.