S2E9 - So You've Found A Property... Now What?

Imti: [00:00:00] You found a property. Now what? Today we're talking about the stretch between finding a property that you like and actually putting in an offer, because for a lot of first time investors, this is where the pressure really kicks in. You found something promising, and now the questions start. What's it actually worth? How do you deal with the agent? How do you make an offer without overpaying or freezing? today we're breaking that down into a five step journey from first inquiry or open right through to putting in an offer without blowing your budget. Now, step one of this, you found the property, you've been scrolling through realestate.com. You've either sent through an online inquiry, you or you've attended an open. Assuming you know your budget at this point, the goal isn't to decide "yes," it's to decide whether the property deserves more of your attention or not. Pete, when someone finds a property they like, what should they be looking at first?

Pete: It comes down to the location of that particular property, so not the suburb itself, but the location within the suburb. A quick check is basically go on Google Maps and seeing where it's located, [00:01:00] making sure it's in a nice quiet street, not on a main road, not directly across from a school.

Anything that's going to deter future renters and future home buyers. You just gotta make sure that the property is in that prime location or is the best location possible for your budget.

Imti: Mm-hmm. What you're saying is that really the analysing the property happens before you even attend the open?

Pete: Yeah, a hundred percent.

Imti: If we were to chunk that down another step, let's say I've looked at the locations, everything's all good, I've gone to an open, what are the things that I should be looking at at the open?

Pete: At the open, it's really the layout of the home, so you can get that from the floor plan anyway, but just how the layout flows through the property, because if it's feeling a bit tight or there's just something a little bit off, renters and future home buyers are gonna feel the same thing.

And look, you can get into the exteriors and everything like that, the building and pest inspector should be checking all of that, but very, very high level, making sure there's no major cracks as well, making sure that in the wet areas it looks good, there's no signs of mould no signs of any water damage. So [00:02:00] cracked tile tiles, tile, look

Skye: at the wall behind the shower.

Pete: Mm-hmm. Yeah. That stuff as well. All the stuff that you could just look at very quickly, from a visual point of view, but don't get too wrapped up on the finer details. That's what the building inspector,

Skye: don't be knocking on the walls or the door.

Pete: Yeah. That's it. That's it. Just visually look, and just keep moving through. Get the flow of the, property itself. Yeah, I think that's a really good start.

Skye: So you're saying what it feels like.

Pete: Yep.

Imti: Yeah.

Pete: Yep,

Imti: It's almost like a first date, right? You're not rushing off to marry the property right now. It's your understanding whether it's got good fundamentals, you can handle its personality, or in this case, gust of wind isn't gonna blow it over.

Skye: Are there any red flags?

Imti: Are there any red flags that you can see? As someone who isn't a professional in the field, just don't turn into that person who goes to look for a car, looks under the bonnet and goes, oh, it's an engine, and you don't actually know what you're looking at. There's a second part of that though, when you are at an open, Skye, this would be good for you to touch on. How do you separate emotional appeal from investment quality?

Skye: I think I have a bit of a hot take on this one because

Imti: here we go.

Skye: That's why I mentioned to you like, oh, so you're talking about how it feels when you [00:03:00] walk through. I make these decisions not only in business, but I maybe used too much emotion when I purchased my first property, but. I think females. I don't know about males. You tend to err on the logic side, but the intuition, the feeling of it, and then we use the facts to back it up.

Imti: Yep.

Skye: So I think it's just about keeping both of those balanced.

Imti: Mm-hmm.

Skye: Rather than getting stuck in how it feels,

Imti: especially when it's an investment. Right?

Skye: Yes, and while I want investors to actually have that attitude of what does this feel like for my tenants?

Imti: Mm.

Skye: At the end of the day, if you're like, oh, we love this home, it's so great.

That's not the purpose of it. So, looking back at the facts. Always. Mm-hmm. To back up what you feel. But that said, though, you walk through a property and you instinctively go, Hmm, yeah, this is not right. Maybe it's the floor plan and it's a bit higgeldy piggeldy and just tacked on. That's not right. Mm-hmm. But then we look at the numbers if everything is emotional.

Imti: Yeah. Makes sense. That's a good point is that you almost need to put the emotions in the bin to, to an extent when you're looking through an investment lens. [00:04:00] But to your comment earlier, I don't think you've seen a guy watching a sports game if you think that they're not emotional.

Pete: I'll add one more quick point to what I was referring to as well around the feel. Going into the open home, getting a feel for the property. Too many people will go through it and they'll start to be like, well, how can I change this floor plan to make it four bedrooms? Or the bathroom looks a bit odd. We're knocking on walls. You're spending the whole time looking at one element of the property, which essentially can really be done after you've looked at it.

Skye: So it's like an overthinking.

Pete: Yeah. Yeah. You're overthinking it.

So that's why my thought process is get through the property. What's the flow like? Does it look good from a visual point of view, does it look like there's any major issues from the building itself, the structure? And then you can think about things later on.

You can go back for the second open, or you can look at the floor plan. Can you convert the second lounge to a fourth bedroom? All of that stuff I feel, comes after.

Skye: Mm.

Pete: So that you're not wrapped up in one room for the 30 minute open.

Skye: Mm.

Pete: Knocking on walls or essentially wasting that opportunity.

Imti: For most first time property investors as well, the emotional trap is actually seeing the property for [00:05:00] what it could be and not what it is. Yeah. Because most first time investors actually won't do all the things like subdivide it, develop it, hearing all these sexy things that are actually disasters 90% of the time.

Pete: Mm-hmm.

Imti: The emotional side of it is actually looking at what the property could be and not what the property is and can you tolerate what it is. If we were to break down that first step of the journey, it really comes down to looking at the location before you even get there. And then when you're there, it's like a first date, you're sense checking it. You're making sure that it ticks the boxes that you need it to tick before it moves to the next stage. It essentially just acts like a filter. And from there we move into step two, which is determining the fair value of the property. So we've looked at the property, passes the first date test, and now we wanna look at how much it realistically will sell for. Pete, you do this every single day, right? As a buyer's agent. If you were to give someone a quick two minute lesson on looking at comparables with just the info that they have available at [00:06:00] home, how do you assess fair market value?

Pete: The first thing we do is not rely on the auto valuations.

Imti: Mm-hmm.

Pete: What we do is we look at at least three to five recent sales, and by recent, I mean within the last couple of months. Ideally the last three months, particularly in a hot market, as close to the property as possible. You might not have too many sales. So within the one to two kilometers of the property, pick those properties. Make sure that they are fairly similar as well to the property that you are looking at. If you're looking at a three bedroom, one bath home on 600 square meters.

Make sure the comparable sales are the same. Three bed, one bath, 600 square meters. And also I guess just making sure that from a location point of view, the comparables also stack up. Don't be looking at a comparable on a main road when the property you are looking at is in a quiet, nice street.

Skye: It can be hard to find sometimes, particularly in a three month window.

Pete: Yeah.

Skye: You are comparing apples and oranges sometimes.

Pete: Yeah.

Skye: But,

Pete: and that's when you can expand that out. The one filter there, good point, is the time filter, so you can really filter that out to six months or 12 [00:07:00] months if needed,

Skye: yeah.

So you can't find the comparables for that property then extend the time.

Pete: Yeah. Yeah. Extend the time

Skye: Rather than the property. Yeah. Compare the main road with one that's not

Pete: Yeah, that's it.

Imti: Mm-hmm. What's something that you see that first time investors, they look at the sold listings, but they might make a very obvious mistake that doesn't seem so obvious when looking at comparables. What's something that sticks out? Is it something that you touched on like earlier, the main road aspect and the actual location of the property, or is there something else that they should look out for?

Pete: It's pretty much that, they just get wrapped up on the photos. They don't check the location and it's not a true comparable.

Skye: Well, sometimes I think because I'm at the sales side of it, the conversations that I'm having with buyers who are potentially those first time investors. They get locked in on the solds and they're not actually paying attention to what is happening in the market. If I'm having the conversation of, I've got 15 offers, but they're like, oh yeah, but the last property sold here.

Imti: Mm-hmm.

Skye: It's kind of irrelevant. So yes, you use the solds as a guide, but don't stay rigid on it.

Listen [00:08:00] to what else is going on.

Imti: That's a great point where, step one, you've dated the property. Step two, you're looking at fair market value. You might actually realise at this point there's a big gap between the price guide and what fair market value of the property is. That the price guide might be 10% under what the property might sell for, and at this point you can actually save yourself a lot of heartache and you just walk away because you'll see this gap and you'll go, oh, yep, not for me. This is gonna go sideways and I should just step off the train now before moving forward. That's a good segue into our third point, which is deciding the sleep at night number. Market value obviously is one thing, and your comfort level is another.

And the key thing here is fair market value and your go to sleep number for this property not lining up. We're assuming that you went into the search knowing your maximum budget, but then budgets change per property. If we were looking at the sleep at night factor, Pete, this is something that you very much guide your clients through because it avoids them getting [00:09:00] caught up with a very good agent who can make them emotional and push them along the journey a little bit. How should someone think about their ceiling price?

Pete: It just comes down to, like you said, the sleep at night factor is it really . At what price point are you going to go to bed comfortable that you missed out?

Skye: And do you think some of your clients have different risk factor tolerances? So what Client A might be completely comfortable, but client B wouldn't even consider that. They've got different tolerances to risk.

Pete: Oh yeah, definitely. And that's where some will be I'll just put out whatever. We just wanna secure it. I don't care how far above we go. Yeah, definitely. And that's when you gotta take 'em back to step two, where it's like, well these are the comps. Also looking at what the property market's doing as well in that suburb and how quickly it is moving. You still gotta stick to a certain price point, you just don't want to go too far above. So that's where we bring those particular clients back in line and say, look, we get that you're willing to go. 20 grand above our fair value range, but we don't think you should.

Skye: Yeah.

Pete: Just bringing that back

Skye: versus the opposite who won't even come up.

Pete: Yeah. '

Skye: cause they're not comfortable.

Pete: Yeah.

Skye: And [00:10:00] understanding what's happening in the market.

Pete: Well, in that particular sense, when people are quite nervous about that, it's just actually thinking to yourself? Well, if I miss this one, is there going to be a

Skye: thousand dollars gonna matter in six months time?

Pete: Exactly. Is it gonna matter? The market's probably moving five or 10 grand a month anyway. It's putting it in front of the client and saying, well look, I know you don't want to come up two grand, and I feel like an auctioner now we're gonna go back into the swing of things, of trying to find properties and there hasn't been anything else that's really come up that is comparable for this price range. It probably is the last opportunity.

Skye: Mm.

Pete: And guiding them through that and showing them the recent comps again, and getting them to also do their own research and essentially trying to get them where they need to be.

But at the end of the day, if they're not comfortable, they're not comfortable, and that's the sleep at night factor. If they don't want to come up 2, 3, 4, 5 grand, then so be it. Sometimes you also need to learn the lesson the hard way.

Skye: Uh, yes. Which we know plenty of people who have.

Pete: Yes. Yeah.

Well, I think we all have

Skye: mm-hmm.

Pete: Yeah.

Imti: Story for another day.

Pete: Yeah. The other side of that, is the borrowing capacity limits as well. We can all come up with fair value and the range, but at the end of the day, you are restricted to the borrowing [00:11:00] capacity. So I guess Imti, did you wanna touch on that from a broker perspective?

Imti: Yeah. There's a few interesting things that you mentioned. The client A, client B, that you both touched on with different risk profiles. Funnily enough, on my side of the fence, they often end up marrying each other. And so the conversation really needs to be even before the search begins, what's our limit? Where do we bend? Where do we break as a team? Because what ends up happening a lot of the time is this fear and risk-based conversation, which is very real, 'cause you're making an expensive decision, and so what happens a lot of the time is couple member A will be super aggressive, wanna get in the market happy to overpay, and person B will be a little bit more conservative. I'm worried about our cash flow. What do we do? And that conversation doesn't actually happen before the property search starts. And it needs to, because otherwise you'll get this far down the process and you'll look at properties that aren't right for the both of you that you can't compromise on that don't match your joint goals as a couple,

Skye: or you're in a time pressure situation [00:12:00] and you can't agree

Imti: yes, or because you're a first time investor, you get caught up in the emotions of it all and you make a decision one way or the other that one person isn't going to be happy with.

So you either buy a property that one of you's gonna resent. Or you miss out on a property that that person's presenting, the person thinks that, yeah, you should have gotten. So the emotional side of it and getting very clear on that is really important. Then the second layer of that is the borrowing capacity and the numbers of it all, and the simple thing here is run a cashflow analysis. Understand what your buffers look like. And what I mean by that is how much is the property going to cost you after all expenses go out, then add 10 to 20% to that number. Can you comfortably go to sleep at that number and maintain your lifestyle? Or if you have to make lifestyle adjustments, are you happy to make those lifestyle adjustments? If you can say yes to all of those things, then it passes the actual go to sleep at night factor. Ironically, price doesn't [00:13:00] really come into it. For a lot of clients it boils down to what is the real life cash flow implication and can I maintain that for as long as possible if the answer that's yes.

Go, go, go. If the property stacks up and that's not a massive overpay that you don't want anything to do with, but that's how I'd guide a client through the numbers aspect of it.

Skye: I absolutely did not think about any of that when I bought my first place,

Imti: and I don't think any of us did when we bought our first investment properties, right? We all saw the market and we were like, oh yeah, we'll just do it 'cause someone said that we should do it.

Skye: I think Pete might have, maybe, and

Imti: yeah, Pete's

Pete: not the first one. I did learn the hard way.

Imti: Pete's probably the most considered out of us.

But yeah, even then, if he made the mistake, then Skye and I definitely made that mistake. To recap, so far we found the property, we've done a walkthrough. It's passed our initial test. We've looked at fair value, we've determined our go to sleep number and whether we're happy on the cashflow side of things.

The key thing here is if it doesn't pass checkbox one, two, and three, you just stop. So if you're listening to this episode and you're working through the framework and y ou just get to point three and you're [00:14:00] hesitant about it, that's your sign that you need to adjust something further upstream. Don't force it beyond this point, because I'm sure that we've seen it, especially right now in very hot markets that sometimes it's forcing the issue, instead of getting very clear on what's important to them, and a lot of that comes from external influence, whether it be people around them, the media, any of those sorts of things. And it just creates this doom loop of either analysis paralysis or you keep on missing out on properties for six to nine months that don't really line up with what you're trying to achieve.

So let's roll into step four, speaking with the agent about the offer process. A lot of people get intimidated here and understandably so. I think that's one thing that we need to get across the line is that negotiating with an agent isn't easy. You're negotiating with a professional negotiator, Pete, I know you hate dealing with agents a lot of the time and you do it for a living. There's no shame here, it's just about getting clear on what's important. When we're looking at speaking to the agent about the offer process. So we're not even putting in an offer [00:15:00] yet. We're just speaking to the agent, understanding what's going on. Skye, what are the type of offer campaigns that could be run? This is probably important for someone to know before they speak to the agent so they can put two and two together when they're speaking to them.

Skye: So there might be a, expiry date on when you can submit your offers. It doesn't mean you need to wait for that. expiry date. And they may well sell it prior to that expiry date. so don't rely on that. The whole purpose of an expiry date is to force action.

Imti: Mm-hmm. '

Skye: cause the other alternative is just simply a price listed or no price, contact agent. But that's just an open-ended game that I think really in this market to me would be a bit of a flag that maybe the vendor wants too much money.

Imti: Mm-hmm.

Skye: Because if the vendor's not realistic about what they want, then it is just going to sit and see what happens.

Imti: what about auctions? Are you seeing a lot of them at the moment?

Skye: Yes. Yes. and auctions, people are either comfortable to go to them or they're not.

Imti: Mm-hmm.

Skye: But the majority are auction, right.

Pete: It depends on the market, but in Adelaide, yeah.

Skye: Mm,

Pete: yeah, definitely Adelaide. Some of the outer suburbs in the north and [00:16:00] the south aren't really auction yet,

which,

but

Skye: no,

Pete: a majority of Adelaide is now auctioned. Yeah.

Skye: Yeah. And certainly it is demographic based.

Yeah. Because there's no point auctioning a property if all your buyers are first time buyers because they're just.

Pete: You're not gonna get the best price.

Skye: No,

Pete: no,

Skye: no. But that's where the best offers by does the same thing. There's a deadline. You can't just take forever to see if you like the property.

Pete: Mm-hmm.

Skye: Whereas just price or contact agent, there's no rush for you. You could just come back to it in a month. Mm-hmm. There's nothing pushing you to actually make an offer,

Imti: Not to put you on the spot, but the best offers by is that legally binding? Let's say there's a campaign, I'm scrolling through realestate.com and there's a best offers by the 27th of March.

Skye: Mm.

Imti: Does that mean that the agent will actually stop taking offers at the 27th of March, or will they take offers after it and there's no real consequence for it?

Skye: Yeah, potentially. I mean, I don't see that happening. But yeah, legally they can do whatever they like.

Imti: Mm-hmm.

Skye: The real risk for people is more that it will sell before that date.

Mm-hmm. So I [00:17:00] wouldn't wait for that date. I see people going, oh, yeah. Particularly if it's a two or three week campaign faffing about, rather than actually showcasing their intentions.

Imti: Mm-hmm.

Multiple offer campaigns, understanding how they work. We've done deep dives previously if you wanna rewind in the catalog where we've broken it all down during a selling seasons series, what should buyers be asking the agent before they make an offer? We've worked our way through. We understand how offer campaigns work.

I'm picking up the phone and I'm calling the agent. What's my list of questions that I should have written down before I call the agent?

Pete: So the first question you wanna be asking is how are they gonna conduct the process? Because all agents are slightly different. Even if it's a best and finals, it is different.

So some agents, for example, will say it's the best and finals by 5:00 PM you don't get a second chance.

Skye: Yeah.

Pete: We just need your best and we're not gonna call you back. That's the key there to take away from that kind of question. you gotta be real direct as well and ask, will I get a second opportunity?

Imti: Mm-hmm.

Pete: So if they say to you, yes you will, what we normally do is we take off as by [00:18:00] X date, we'll then call you back after we've got all offers. You want to get that second phone call.

Skye: That's how I operate.

Pete: Yeah.

Skye: But not all agents will. And it depends on how motivated the vendor is too. There may be other reasons why they just get it done and cut it off.

Imti: Well, that's the thing, a lot of first time property investors inherently right? It's their first time. And even being more experienced in the journey, I didn't learn that agents conduct campaigns differently.

Skye: Mm.

Imti: Around, for example, best and final, whether they'll call you back, whether they won't. I always just assume that I would get a call back.

Pete: Mm

Skye: mm

Imti: Most people do.

And they don't go in with the best and final.

Yeah. That's a really powerful question to ask in terms of how they will be executing the campaign. What else would you say that they should have written down in their notebook before they call the agent?

Pete: It depends on the timing of it all, but I like to drop that final call really close to the deadline because you wanna ask questions like, how many offers? So normally within the hour of the deadline, I'll call. If there's 10 offers, then you know you're probably gonna be well above the range. If there's more than that, then you're gonna be well, well above. Or if there's only two or three offers, for example, you're probably gonna [00:19:00] be around the mark in terms of the price guide. But yeah, try and get some feedback on pricing as well. So a question I like to say is, where are offers sitting at the moment? Are we below the guide, above the guide, gives you a bit of an indication? Yeah, those would be the two. I think if you are only gonna ask two questions, those are the two plus your third question at the, at the start, which is around, uh, how they're gonna conduct the campaign.

Skye: That's a really powerful question. Where are we sitting in the price guide?

Imti: Mm-hmm.

Skye: A lot of people don't ask me that and I feel like they should,

Pete: Or they'll be direct where are prices sitting? And an agent can't disclose that, but they can disclose a rough guide.

Skye: Yeah. And I would happily say, look, the majority are over the price guide or

Pete: Yeah,

Skye: we're around the mark.

Pete: Yeah.

Skye: Rather than an actual number. But a lot of people will say to me, where is my offer? Asking

Imti: for exact numbers

Before you run ahead. Let's let transition into step five.

Yeah. Because I think you're about to hit the ground running with it, and it'll be really, really good because step five is actually putting in the offer.

Skye: Mm-hmm.

Imti: Number four, you're really speaking with the agent about the process. You wanna understand how the agent is going to conduct it, so you are clear. [00:20:00] Then you can actually make an informed decision around putting in an offer.

Skye: Can I touch on one thing before we jump to stage five? Yeah.

Imti: Go.

Skye: No one believes what comes out of a real estate agent's mouth, right?

Imti: Said as a real estate agent,

Skye: Frequently the question is, do you have offers? I get asked that a lot. And I can tell you as the sales agent that there is definitely an energy that you bring that you can't control it. So if you've got a good offer that changes your energy. And so if you are being observant and you're asking these questions of the agent. When you say, do you have offers, they may have an offer, but it's not selling the property.

Imti: Mm-hmm.

Skye: So you can pick that up if you are observant.

Imti: So when you're talking about changing of energy, you are talking about the agent's energy that you're speaking to, right?

Skye: Yes. Yes. Thanks for clarifying.

Imti: What would be a behavioral example that someone could look for in that energy shift.

Skye: Not myself, but it's just an overall disinterest in the open inspection, for example.

Imti: Mm-hmm.

Skye: Because they know it's already done. They don't even need to be here, they don't care about you or your goals. Hmm. They're just done. They could also [00:21:00] just be a bad agent. But that's generally probably the first thing I'd look for.

Imti: Mm-hmm.

Skye: Yeah, it's an overall attitude, I think, and it's not something that I can control. And so when I've got an exceptionally anxious vendor and we're not getting the offers we want, that energy bleeds into me and I can't get rid of it. It's like a smell. And so you can probably sense that.

Imti: it's the little things, right? The agent might seem

Skye: super keen,

overly

Imti: excited, and super keen, right.

Skye: Actually calls you back

Imti: Yeah. Actually calls you back, is super high energy.

Skye: Yeah.

Imti: Is trying to motivate you to take action. That probably indicates that they don't

Skye: spending time to get to know you.

Imti: Yeah.

Skye: They've got nothing else.

Imti: That probably indicates that they got a lot of offers sitting there, right. Whereas if they're disinterested, they're picking between 10 offers that are all within 20 grand, 30 grand of each other. I think something that's. Important for people to understand in this part of the process is that from an agent's perspective with how they get paid and how commissions are split and all that sort of stuff, a 20, 30 grand difference doesn't actually make a big difference to them.

Skye: Zero. We don't care.

Imti: It's,

Skye: yeah.

Imti: Am I selling the property and am I getting the [00:22:00] huge commission check? Not, oh, I got an extra 30 grand out of it and then I get. 0.5% of that 30 grand split in half after all my expenses.

Skye: Yeah.

Imti: So I think that's something really important to understand that that disinterest from multiple offers, it does kind of present itself, especially when you're on the phone.

So it's

Skye: a vibe.

Imti: Yeah. And puts you in a position to then step five, putting in an offer. So very brief, very tactical. Pete, being someone that puts in offers every single day, what's the backbone of a really strong offer?

Pete: Yeah. So knowing your value. Putting the value where you're comfortable. But the conditions is probably the more important thing. Making sure you've got strong subject to finance clause, making sure that the days for approval are relatively short, building and pest inspections, and a tight settlement period.

Imti: Mm-hmm. And that's where, if anyone's listening to this for the first time and you want more context or more info around that, we're talking 30, 45 minute deep dives just on those

Pete: Yeah.

Imti: Topics that you can unpack. I think that's a really great summary. Skye is the person who receives the offers [00:23:00] on the other side of the fence. What's the backbone of a strong offer when it's a selling agent receiving it?

Skye: Hmm. I think confidence plays a big part. In being clear on what your offer is.

Imti: Mm-hmm.

Skye: If you are going to be successful, we've mentioned about having that sleep at night number and all that, the strong offers are obviously meeting what the agent has specified.

Imti: Mm-hmm.

Skye: The vendor's looking for whether that is a longer settlement or 30 days, whatever that may be. The challenges of a not great offer is obviously price, but it's also around how the buyers conduct themselves.

Imti: Mm-hmm. Because price is important, but it's not the be all and end all.

Skye: No.

Imti: And I think that step four being getting clear on how the agents going to run the campaign and understanding what's important. Helps you put in that strong, clear offer that if the vendor has six things that they wanna achieve out of the sale, you're ticking all six boxes instead of just the price box and that's it.

Right?

Skye: Yeah. And I guess that's part of the pre-work that you're doing. [00:24:00]

Imti: Mm-hmm.

Skye: To find out what they're actually looking for. And it's the interactions with the agent, that's probably, the bit that I was talking about before that people can actually put the agent offside really quickly and that doesn't motivate the agent to put your offer to the seller. While they will present it, there's going to be other commentary added.

Imti: So between the two of you, really what I'm hearing, apart from price, it's about confidence, being clear. Mm. And checking off as many boxes as you can with what the vendor's actually looking for.

Skye: Add one more speed. Comply with the timeframes. Yeah. Yeah. 'cause if you are calling me at 5:30 and the offers closed at 5, sorry. Mm.

Imti: Mm-hmm.

Pete: Not a good look.

Skye: No, no. Were you really that motivated? Yeah.

Imti: Yeah. And that would be a massive red flag.

Skye: Yeah.

Imti: Let's jump into a quick bonus tip. Step six, which you've put in your offer, right?

Awesome. But what happens when you get a counter and it's not a best and final situation, or it's not an auction where it's just done on the day. And the agents pulled you aside and gone, oh, there's multiple offers, and [00:25:00] they're trying to build up that tension. This is where it can get really emotional and turn into a bidding war.

And that's exactly what we don't want. So throwing it over to Pete, how do you avoid an emotional bidding war happening when you're in this situation?

Pete: Look, ideally you won't be if you follow our tips because you would've put the fair value and you'd be able to just walk away, essentially. If an agent comes back to you wanting more money look, you just dunno if they're ever telling the truth.

I've been caught out multiple times at the beginning as well. I didn't believe the agent, there was another buyer. Other times where we've come up a little bit higher, we were successful, but you just never know whether there was another buyer. At the end of the day, the questions that you asked before should give you an idea of how competitive the property is going to be.

Imti: Mm-hmm.

Pete: And if they come back with a, there's higher offers, can you do a little bit more? It's really up to you in terms of your sleep at night factor, whether you wanna come up, if it's significant number, then you obviously don't wanna entertain it. But if we are talking a couple of grand. You just gotta think to yourself, well as long as it still fits within the fair value, sleep at night factor and it's gonna get the deal done. 'cause that's what I always [00:26:00] say. If we do come up by five grand, for example, are we getting the deal done today? If the agent says yes, I'll strongly consider it. If it's a bit of hesitation and I just don't have the confidence then. To be honest, we probably don't go up and we just let it sit for a couple of days. But you also don't wanna miss the property either, 'cause you just don't know which buyer's gonna come through the doors the next day as well.

So if you can lock 'em into the price, then I think you do come up as long as it's within that comfort level.

Imti: Mm-hmm. And this is where it can get really sticky, right? And something you touched on just now is that you don't know whether the agent is actually telling you the truth about multiple offers.

Pete: Mm.

Imti: If they come back to you with a counter

Skye: Yeah, you'll never know. It's impossible

Imti: From the horse's mouth.

Skye: Yes.

Imti: From the agent. You'll never know.

Skye: well, 'cause otherwise you're at auction, right?

Imti: Yeah, yeah.

Skye: That's the only transparent way to know.

Imti: And I think the thing here is that a lot of people can get held up on how do you know if the agent is lying and that the process is really painful and mistrustworthy in some places.

And just stressful, right. The core [00:27:00] here for me when I'm guiding clients through this stage is it doesn't matter. It doesn't matter if the agent's lying.

Skye: Mm-hmm.

Imti: The agent's job is to get as much money and the best conditions through the door for the vendor. Your job as the person putting in the offer to Pete's point, go to sleep factor.

Skye: Commit to your price.

Yeah.

Imti: Commit to your price. Set those hard limits. Obey by that. And then if you do miss out, maybe you need to reflect on your numbers, not during an offer stage. That way you don't put in an emotional offer and you go and look at the next property after you reassess. But don't reassess on the fly.

Pete: Yeah,

Imti: Because that's when you'll get emotional and you'll overpay.

Skye: I don't do them, but the agents who use the online bidding process. Yeah. Right. And so you leave it till 5:00 PM, I've got a client who did this, and you're potentially bidding against one or two other bidders and you can see their position.

Pete: Mm-hmm.

Skye: So that's a bit more transparent. Would you trust that?

Pete: Um, I'm not a big fan of those systems, but yeah, I guess you have to trust it. At the end of the day, if that's what the system says, then [00:28:00] you gotta to trust it. But again, all of that shouldn't be a problem if you've done your numbers right, 'cause you can stretch up to that top end of the guide and be comfortable, sleep at night. Just go for it, put it in and see where it lands. Don't get wrapped up but it's a good point.

Imti: Yeah. That's the thing, right? It's a manipulative, murky, gray process.

Pete: Yeah.

Imti: Unfortunately, it is what it is. And so it's like how do we make sure there's guardrails in place for ourselves when we're going through the process? Because we know that the process is gonna be shoddy. And I think the six steps that we walk through really do that. The goal isn't really to be fearless or cavalier or have all the answers. As a first time property investor, realistically, you're never gonna have all the answers. As experienced property investors, we never have all the answers. It's about being structured, working your way through the six steps that we just spoke about so you can assess an opportunity properly and kick it to the curb as early as possible and work your way through. That way you're only putting offers in on the properties that tick all of your boxes instead of rushing [00:29:00] to put an offer in straight away and then continuously missing out. The key takeout for anyone listening to this really is slow down to speed up, understand what's important, and then go out and start shopping. Because if you try and shop while getting clear at the same time. Unfortunately, you'll be stuck in the doom loop of missing out on properties for six to nine months, and we see it every day. A lot of the time. Pete, I know I need to wrap us up and I'm rambling, but we talk all the time about how a lot of clients that you work with, they've been missing out for six to nine months and because they're at that point, that's why they reach out to you.

Pete: Yeah.

Imti: Whereas if they were a little bit more structured in the way that they went about things, they would be able to avoid a lot of landmines and probably do it themselves. So on that note, I'm gonna wrap us up. Guys, as always, it was lovely unpacking this with you, but I think the key thing here is just work through those steps and you'll be fine. s. [00:30:00]