Why Off-Markets are Challenging

We are often asked about off-market properties by prospective buyers. There is little surprise that these types of sales are made available to advocates based on our market reach and agent relationships.

But there is one other strong reason why advocates partake in these types of sales more than a regular buyer.

They can be challenging.

From establishing the vendor’s willingness to sell, to negotiating under unusual terms, much more is involved in these types of purchases.

This week we proudly negotiated three properties off-market, and all were quite different assignments. It’s fair to say that negotiating the terms of the negotiation is one of the most crucial first steps, because we must confirm how the process is going to run before we put forward an offer. We canvas how the property is being marketed. Are we the only advocates introduced? Have others seen it? Is the property ready to sell now?  Does the vendor require unusual settlement terms? And can we meet these terms? How will the offer be handled? Will the vendor commit to an answer within a specific time? And most importantly, how will competing buyers be handled? Will the negotiation be transparent?

Unlike an auction campaign, the rules are not so obvious for off-markets.

Every single one is different. Buyers underestimate how precarious a sale can be for this format, and when emotions are running high (for buyers and vendors), it doesn’t take much for the whole house of cards to topple over. Managing communication, ensuring we aren’t placing too much pressure on a vendor, making sure the deal is fair and avoiding paying a premium are all essential elements we must consider.

This week’s acquisitions for our clients were not just exciting, but fabulous opportunities which met our three briefs absolutely perfectly.

Special congratulations to our three off-market buyers! From Brunswick to Camberwell and back to Footscray, it was one exciting week.