It is frustrating for buyers when they miss out a property they really wanted. So what is it that prevents a prepared buyer from purchasing the property they so love? Basically there a four main reasons, two are them are acceptable while three are preventable and upsetting when they occur.
1. The first (and probably most obvious) reason is when another buyer is prepared to pay a higher price than what the initial buyer believes the property is worth to them or that they can afford to pay.
2. The second reason, which is acceptable, is when the due diligence uncovers something that either adversely affects the value of the property or the appeal which the buyer was attracted to in the first place. For example, if a property fails a building and pest inspection or if due diligence uncovers some sort of zoning or resumption or nearby building approval that would change the appeal.
Then there are two reasons that are “bad” reasons to miss out on a property.
3. Being unprepared. Buyers who shop without finance in place, or underestimate the minimum contribution required are asking for heartbreak. It isn’t just the purchase price that is needed but the cost of the purchase which includes such expenses as stamp duty, solicitor’s fees, land tax, mortgage registration and insurance, etc.
4. The fourth is playing games with the agent or stretching the quest for a bargain just that bit too far. Buyers who ‘play possum’ by not providing their contact details to an agent or providing incorrect details after seeing a property, particularly when an auction property, are likely to be disappointed. The same can be said for buyers who tell the agent their offer is their final offer when it isn’t. An agent may take you at your word. And for those buyers who could have purchased the property for an acceptable price but toyed with lower offers to be cute, only to find another buyer comes along with the acceptable offer, they will have competition from that point on and will be likely to pay significantly more than what they could have when the agent was being straight with them about the buy-it-now price at the onset.