The increasing numbers of people prepared to buy property sight unseen could prove to be a financial disaster, according to a Sydney buyers’ agent, BFP Property Buyers.
BFP Property Buyers’ insight on the trends
Ben Plohl, the Founder and Principal of BFP Property Buyers advised for caution.
“There appears to be a growing volume of buyers who are willing to take a gamble on a property investment because of lockdown frustration or their fear of missing out.”
“Let me get this off my chest. Real estate shouldn’t be akin to gambling or speculation. If you want to gamble, there are many places to roll the dice with your finances.”
“The reason why I say this is because investing in property, whether you are a home owner or a property investor, is an expensive aspect to indulge in and therefore, there is too much at stake financially to roll the dice and purchase a property when it is unseen.”
“Would you be prepared to work for free for a year, which is the average deposit size, because you threw your hat in the ring on a property that you had never even inspected?”
BFP Property Buyers advocates for caution
Mr Plohl said that technological advantages like a video walk through with selling agents seems to be replacing due diligence and thorough inspections by objective professionals.
“In many instances, buyers are saying that the video footage from the sales agent had helped to convince them to purchase the property. I’m not going to disparage our selling agent friends because we work well with them to secure properties for our clients.”
“Just as it is with real estate photography, it is highly unlikely that most of the sales agents would point out any overly warty aspects during that walk through, would they?”
Mr Plohl said that in addition to potentially only being shown a property’s favourable attributes and not many of its issues during the video tour, buying sight unseen real estate properties also prevented buyers from understanding a myriad other important factors.
These include topography, orientation and the impact of traffic noise like trains and planes.
According to Canstar, a whopping 11% of Australians would be willing to purchase a real estate property without viewing it in person, a percentage that hopefully includes individuals who are working with qualified property investment advisers and buyer’s agents.
“However, if millions of people are prepared to take a gamble on real estate investments while simply believing in perpetual capital growth regardless of whether they blindly buy a dump, such a decision could wind up being financially catastrophic from them.”