How can brokers and buyer’s agents work better together?

There are around 18,500 brokers and, at best count, maybe 1,800 buyer’s agents in Australia. The value proposition for a broker is clear, especially given that it comes at no cost to the client, whereas a buyer’s agent is a harder sell, who charges a fee for service. 

Nevertheless, there are definite benefits for a broker who wants to align themself with one or more buyer’s agents.

What are the benefits for a broker?

An experienced buyer’s agent will manage their clients’ expectations so that they don’t fruitlessly look for a unicorn. Often a client will tell us they have capacity for a higher approval, but until they recognise that they simply can’t get what they want for their original budget, they won’t see merit in extending their borrowing. 

When appropriate, early in the search process, we will recommend when a client needs to go back to their broker to discuss increasing their limit. 

A broker and a buyer’s agent can collaborate to provide insights and guidance to help calm their clients’ nerves in changeable market conditions. For example, when there is a risk that a low valuation could erode the borrowing capacity for a specific property, detailed pricing research conducted by the buyer’s agent can give the client more confidence to make an offer.

If the broker can outline two other financing options in the event of a lower-than-expected valuation, the client will feel supported and, therefore, more likely to proceed.

We will also give our clients’ broker the heads-up on each property we’re about to evaluate in case there’s a hurdle with finance. For example, if there are issues with limited title, company title, postcode & building black spots, we’re best to know before we undertake the due diligence.

We know that buyers ask brokers a lot of property-related questions and this can place great demands on your time. 

While legislation prevents buyer’s agents from giving financial advice, property advice, on the other hand, is unregulated. 

Most brokers want to help, but responding to these requests takes you out of your swim lane. A broker may have the same tools as a buyer’s agent, but they don’t know how to use them. This presents a great opportunity to introduce a buyer’s agent who can give your clients the answers they need.

These interventions will generally result in clients finding a property and having the confidence to commit a lot faster than when left to their own devices.

Who to work with?

The first step is to find a buyer’s agent who specialises in your local area and aligns with your philosophy and values. 

If you assist clients in a wide geographical area, particularly if you cross state borders, I recommend that you find the best expert in each location with a minimum of five years of experience. Not all buyer’s agents are equal and there are a lot of new entrants to the market, many of whom have little to no experience. 

There are also different types of buyer’s agents to be aware of. Some do not specialise in any one market and will buy all over the country. In my experience, these “FIFO” (fly-in fly-out) buyer’s agents tend to be transactional in nature and lack the necessary local knowledge to buy the best asset. 

There is also a distinction to be drawn between a buyer’s agent and a “wealth creation” adviser. The latter focus on selling property plans that may or may not be actionable, whereas a local specialist buyer’s agent focuses on finding, evaluating, and securing the right property for their client.

Once you’ve identified your list of potential partners, take the time to understand each other’s role in the buying process as well as their scope and value proposition. This will help you know which buyer’s agent to refer to which client.

When is the best time to introduce a buyer’s agent?

Many people approach a buyer’s agent before they’ve gone through the pre-approval process, so it’s a no-brainer for buyer’s agents to mention brokers to prospects even before they become a client. 

My team is proactive in recommending brokers who we know and trust because we understand the benefits for buyers, for example.

On the flip side, at what point should a broker mention a buyer’s agent? You can start the conversation during your fact-find with a simple question asking whether they’ve ever considered using a buyer’s agent. If they’re not open to the idea, at least you’ve planted a seed. Perhaps you’ll need to revisit the subject if their search drags on and they never find anything they like.

An obvious time to suggest a buyer’s agent would be when a client keeps missing out, whether it be at auction or through being outgunned in negotiations. 

Contrary to what many believe, it’s not just the person with the deepest pockets that gets the property. An expert buyer’s agent can bring an enormous advantage through their market intel and, importantly, knowing what to do with that information.

I have learnt a huge amount from the brokers I’ve referred to — as a result I know when to encourage a client to reach out to their broker, rather than make inferior decisions on their own. 

You, too, can learn from buyer’s agents you work closely with, so that you can be proactive with your recommendations.

Professional referral arrangements are not just good business practice, they’re about providing superior service. 

These relationships allow our clients to gain more holistic advice, as we work together to create greater value and longer-term relationships. 

Fundamentally, they want to buy a property and you don’t want to keep renewing pre-approvals … it’s a win-win. 

What’s the most annoying thing brokers do? (From a buyer’s agent’s perspective) 

• Hand out AVMs

• Step outside their lane and give property advice

• Tell buyers they get a cooling-off period when the property is going to auction

• Say, “make sure the contract is ‘subject to finance’”

• Not keeping the buyer’s agent informed on pre-approval progress

What’s the most annoying thing buyer’s agents do?* (From a broker’s perspective) 

• Don’t do due diligence, so the client asks the broker questions the buyer’s agent should be answering

• Sell a property plan for thousands of dollars that looks good on paper but will never work

• Not keeping the broker informed when they’re pursuing a property

• Being pushy with clients and having a transactional approach

*A good buyer’s agent won’t do these things. This is why I recommend seeking out experienced, local specialists who care about their clients enough to provide independent advice and do the necessary due diligence.

Veronica Morgan is a licensed real estate agent, buyer’s agent, and qualified investment property adviser. 

She is the co-founder of Home Buyer Academy, principal of Good Deeds Property Buyers, and co-founder of Suburb Help.

She is also the co-host of Your First Home Buyer Guide podcast, The Elephant in the Room podcast, and Foxtel’s Location Location Location Australia and Relocation Relocation Australia TV shows.

She authored Auction Ready: How to buy property at auction even though you’re scared sh!#less