Free Buyer’s Advocate Melbourne: What Does “Free” Really Mean?
“Free buyer’s advocate.”
It sounds attractive. Everyone loves a free stuff or two. Buying property is already expensive enough, so why would anyone pay thousands of dollars for professional buyer representation if someone else is willing to provide apparently similar help for free?
The answer is not necessarily that a free service is bad. The more useful question is:
If you are not paying the buyer’s advocate, who is?
And after that:
Does the way they are paid affect what they can recommend to you?
Those are the questions every buyer should understand before accepting any “free” property advice. Nothing is free. If its free to you, it usually means you are the product.
Now, let's start with the basics.
What is the duty of a buyer’s advocate?
In Victoria, Consumer Affairs Victoria describes a buyer’s agent, or buyer’s advocate, as a licensed estate agent who acts for a buyer rather than a seller. Typical services can include sourcing properties, assessing them, determining fair value, inspecting, negotiating, bidding at auction and following the transaction through to completion. Consumer Affairs Victoria
A genuine buyer-side adviser should therefore be helping answer questions such as:
Is this actually the right property?
Is it worth the asking price?
What are the risks?
What comparable sales support the value?
Are there better alternatives?
Should I negotiate?
Should I walk away?
Those questions matter regardless of whether the buyer is purchasing an established home, townhouse, apartment, investment property or new development.
So how can a buyer’s advocate be free?
Professional advice is always funded. If it is not funded by you, someone else is.
If the buyer does not pay the adviser directly, payment may come from another participant in the transaction.
Depending on the business model, this can include:
a property developer
builder
project marketer
seller
sales agency
referral partner
finance provider
another service provider
There is nothing inherently improper about a commercial referral arrangement. The important issue is disclosure and alignment of interests.
Consumer Affairs Victoria specifically recommends buyers ask whether their buyer’s agent receives rebates, commissions, discounts or other benefits from third parties or service providers they recommend. Consumer Affairs Victoria.
So rather than simply asking whether the service is free, ask:
Who pays the adviser if I buy?
Who is the agent legally acting for?
This is more than a philosophical question. In Victoria, estate agents are subject to professional conduct rules about whose interests they must protect.
Regulation 11 of the Estate Agents (Professional Conduct) Regulations 2018 (Vic) requires an estate agent or agent’s representative to act in their principal’s best interests, subject to limited exceptions. The Regulations are made under section 99 of the Estate Agents Act 1980 (Vic). AustLII
The same Regulations define the principal as the person who engages the estate agent to act on their behalf. AustLII
Victorian professional conduct rules require an estate agent to act in their principal’s best interests. So if someone offers you a “free buyer’s advocate”, ask two separate questions: Who has legally engaged you to act, and who pays you?
That means buyers should not simply rely on a marketing description such as “buyer’s advocate” or “buyer adviser”. Ask:
Who has legally engaged you?
Who is your principal in this transaction?
Are you acting under a buyer’s agency authority for me?
Who pays your remuneration?
Do you receive any other commission or benefit from the seller, developer or builder?
Consumer Affairs Victoria also states that a buyer’s agent is a licensed estate agent who acts for the buyer, and that buyer’s agents must act in their client’s best interests. Consumer Affairs Victoria
This creates an important distinction between who pays and who the agent legally represents.
Although a developer may fund or remunerate an adviser through a commercial arrangement, but the buyer should still establish who the legal principal is and whether the adviser is genuinely acting under an authority for the buyer.
Now, ask yourself,
if you were the developer, will you pay a sales person or marketer to work against you?
If the answer is unclear, ask for it in writing.
The five questions I would ask any “free” buyer’s advocate
1. Who pays you?
This should have a clear answer. If the adviser receives a commission from the developer, builder, vendor or project marketer, ask them to explain it.
The question is not intended as a confrontation. You are simply trying to understand the commercial arrangement behind the advice you are receiving, so you understand what's not mentioned about their services and advice.
2. Do all properties pay you?
This may be even more important. Imagine this very real situation. There are 20 suitable properties available. If only five of those properties will pay the adviser a commission, can the adviser genuinely compare all 20?
Ask:
Can you recommend a property that pays you nothing?
If the answer is no, you should understand that what is being offered may be a selection from a panel of available stock, rather than completely unrestricted buyer advocacy.
That distinction matters.
3. Does the commission vary between properties?
Suppose Developer A pays one amount and Developer B pays considerably more.
Ask:
Does your remuneration change depending on what I buy?
If it does, the buyer should know.
The key issue is not simply whether a commission exists, but whether there could be a stronger commercial incentive to recommend one property over another.
The answers to questions 2 and 3 is very telling. Are they really a genuine pro-buyer advocacy? Will their recommendations be driven by the commission? And further tainted by the amount of commission they receive?
4. Would you recommend an established property instead?
This is a very useful test.
Suppose you approach a free adviser wanting a new apartment or townhouse.
After reviewing your circumstances, the objectively better decision might actually be an established property.
Would the adviser tell you that?
Ask:
If an established property was better for me than the new developments you represent, would you recommend it?
And:
Would you still get paid if I bought it?
Those answers reveal a lot about the scope of the advice.
5. What happens if the best advice is “buy nothing”?
Sometimes the best property decision is not to transact.
Perhaps:
the market is overheated
the available stock is poor
the location is unsuitable
the developer carries unnecessary risk
the property is overpriced
your finances are not ready
the numbers simply do not work
A buyer-side adviser should be commercially capable of saying:
Don’t buy this.
So ask:
If you advise me not to buy anything, do you still get paid?
That is one of the simplest tests of alignment. You need to answers to:
If I don’t pay you, who does — and who is your legal principal?
The first investor’s tax benefits may not exist for the next buyer
There is another issue investors should think about when considering new property. A brand-new investment property can have tax advantages associated with new depreciating assets and capital works. But some of those advantages are strongest for the first owner.
Under current Australian tax rules, subsequent purchasers of an existing residential rental property generally cannot claim depreciation on certain second-hand depreciating assets that were already installed in the property.
That means a new apartment or townhouse can sometimes look more attractive to its first investor than it may look to the investor who eventually buys it from them.
And that matters because one day you will probably want to sell.
At resale, the property can no longer rely on being “brand new”. The next buyer will judge it against established alternatives based on fundamentals such as:
location
land component
floorplan
natural light
construction quality
owners corporation costs
supply of competing properties
rental demand
scarcity
and resale appeal.
In other words:
Tax treatment can help make a new property attractive to its first investor. It cannot make a mediocre property a good long-term asset.
This is another reason the property needs to stand on its own merits.
Could higher commissions influence which new properties are recommended?
This is where buyers should be particularly careful about incentives. Developments do not necessarily pay identical commissions. A project that is easy to sell may require little external assistance. A property that is harder to move may have stronger incentives available to brokers, marketers or referral channels. So, incentives and the amount of commission is often used to the free buyers agents to promote a certain property.
That does not mean every higher-commission property is bad, nor does it mean every developer-funded adviser will recommend poor stock.
But it creates an obvious question:
If one property pays the adviser substantially more than another, could that affect which property gets recommended?
This becomes especially important when the property already has weaker fundamentals — for example:
an inferior position within the development
poor orientation
awkward floorplan
oversupply
high owners corporation costs
compromised outlook
excessive investor concentration
or an inflated new-build premium.
The danger is not just paying too much today. The real cost may appear years later at resale, when the incentives and marketing campaign are gone and the property has to compete in the ordinary established-property market.
The next buyer does not care what commission was paid when you bought it. They care what the property is worth then. They will be bothered if the property is not in a compromised location, oversupplied, or low rental demand.
That is why buyers should ask not only:
“Is this a good new property?”
but:
“Will this still be a desirable property when it is no longer new?”
Who really pay the "Free Buyers Agents"? Are developer commissions built into the property price?
Developers will often say that the buyer pays the same price whether they purchase directly or through a referring adviser. That may be true in the sense that the headline purchase price does not change.
But it does not answer the most important question: who ultimately funds the commission?
In many new developments, referral and sales commissions are paid from the developer’s marketing and sales budget. These costs form part of the overall economics of the project and are ultimately recovered through property sales price. Yes, YOU, the buyer, is ultimately paying for the cost of the commission, even though the "Free" buyers agent is paid by the developer.
This can matter even more when the buyer is purchasing with a mortgage.
For example, if a $30,000 developer commission is effectively built into the purchase price and financed over a typical 30-year mortgage at 6.5% interest rates, that extra $30,000 would cost about $68,000 in total repayments FROM YOU, including roughly $38,000 hidden in the mortgage interest, if the loan were held for the full term.
Suddenly, that free advisor is costing you $68,000 over the 30 year loan. Now, compare this to a typical $15,000 fee you pay for a proper, independent buyers advocate.
So while the buyer may be told:
“You don’t pay the adviser anything.”
the economic reality is usually be very different.
The commission may simply be buried inside the cost of the house rather than appearing as a separate invoice. And if that new home price is financed, the buyer may continue paying for it, plus interest, for many years.
That is why the relevant question is not simply:
“Did I pay anything directly to the adviser?”
It is also:
“Was the adviser’s commission ultimately funded through the price of the property?”
And, just as importantly:
“Did the person recommending this property have a financial reason to prefer it over another property?”
Those are very different questions — and buyers deserve clear answers to both.
Is a developer-paid buyer’s advocate automatically conflicted?
Not necessarily.
A developer-funded adviser may still provide useful information and professional assistance. They may know the available projects extremely well. They may help buyers understand floorplans, inclusions, construction timelines and purchasing procedures.
The issue is that buyers should understand what the adviser is and is not able to recommend.
A property adviser can be competent and helpful while still operating inside a restricted commercial model.
The problem arises when a buyer believes they are receiving unrestricted independent advice but is actually being shown only properties from which the adviser can earn a commission.
That is why disclosure, and understanding what it means, matters.
“Buyer-paid” does not automatically mean “good” either
This is equally important. Paying a buyer’s advocate yourself does not guarantee good advice.
You should still verify:
licensing
experience
local knowledge
appraisal methods
due-diligence capability
fee structure
conflicts
reviews
who you are actually working with
whether the advocate will recommend walking away
franchise branding - franchise usually have a "preferred" developer they work with.
Consumer Affairs Victoria recommends buyers investigate many of these same factors before appointing a buyer’s agent, including experience, whether the business also represents sellers, services covered, fees, professional indemnity insurance and third-party benefits. Consumer Affairs Victoria
So the real distinction is not:
Free = bad
and
Paid = good.
It is:
Do you understand who the adviser represents, how they are paid, and whether their commercial and financial incentives align with your interests?
What does “independent” actually mean?
“Independent” is one of the most overused words in property marketing. It should mean more than simply putting the word on a website.
In Victoria, estate agents have professional obligations to act in their client’s best interests and avoid putting their own interests in conflict with those of the client. Consumer Affairs Victoria also specifically identifies undisclosed commercial interests in recommended suppliers as a potential conflict. Consumer Affairs Victoria
In Concierge Buyers Advocates, "Independent" means freedom to recommend what is truely the best fit for the buyer's brief. Our recommendations and advice are not tainted by franchise messaging, commissions, etc.
For a buyer, practical independence questions include:
Do you sell property?
Do you represent vendors?
Do developers pay you?
Do builders pay you?
Do selling agents pay you?
Do you receive finance referral commissions?
Do you receive conveyancing or property-management referral payments?
Does your remuneration change depending on the property I buy?
Can you recommend something that pays you nothing?
Can you recommend that I buy nothing at all?
You should be comfortable with the answers before signing anything.
A Simple Example
Imagine two properties.
Property A
A brand-new townhouse.
The developer will pay the adviser $30,000 if you buy it.
Property B
An established townhouse three streets away.
It is in a better, matured location, has stronger resale characteristics and is $80,000 cheaper.
But the developer will NOT pay the adviser if you buy it.
From a quality point of view, Property B is a better asset. Buyers should be going for Property B. But if nobody paying the adviser if you purchase Property B, which property will be presented to you?
A genuinely independent buyer adviser should be assessing both and recommending the better one. That does not mean every developer-paid adviser would recommend Property A. It simply illustrates why understanding who and how your advisors are paid matters to you.
What should buyers ask before accepting “free” advocacy?
Here is the checklist I would use:
☐ Who pays you?
☐ Who is your legal principal?
☐ Am I engaging you under a buyer’s agency authority?
☐ Who pays your fees or commissions?
☐ Do you receive payment from anyone else connected to the transaction?
☐ How much are you paid?
☐ Does that amount vary?
☐ Which properties can you recommend?
☐ Can you recommend properties outside your panel?
☐ Can you recommend established property?
☐ Can you recommend a property that pays you nothing?
☐ Can you recommend that I do not buy?
☐ Do you represent sellers or developers?
☐ Do you receive other referral commissions?
☐ Who is legally acting for me?
☐ What due diligence will actually be performed?
☐ Who determines fair market value?
☐ Are you licensed?
☐ What exactly am I signing?
If the answers are clear and you are comfortable with them, you can make an informed decision.
If the answers are vague, that is useful information too.
How Concierge Buyers Advocates approaches this
At Concierge Buyers Advocates, our business model is deliberately buyer-side.
We do not represent vendors.
We do not sell developer stock.
We do not have property sales targets.
We are not required to recommend a property simply because it is available or because someone else is paying us better to sell.
That matters because sometimes our recommendation is: Buy it.
Sometimes: Buy it — but only below this price.
And sometimes: Walk away.
Independence is valuable only if it gives us the freedom to provide all three answers. This principle is also reflected in how we describe our business publicly:
Concierge Buyers Advocates does not represent vendors, sell developer stock or operate property sales targets. Concierge Buyers Advocates Melbourne
The bottom line
A free buyer’s advocate may be perfectly suitable for some buyers. But “free” should never be the end of the investigation. In fact, “free” should prompt more questions, not fewer.
Instead, ask:
Who pays them?
What can they recommend?
What can’t they recommend?
Do different properties pay different amounts?
Would they recommend something that earns them nothing?
Would they tell me not to buy at all?
Once you understand those answers, you can decide whether the advice is genuinely aligned with your interests.
When you are spending hundreds of thousands—or millions—on a property, the most important question is not whether you can save $20,000 in advisory fees on a $1 million purchase.
The more important questions are:
Can you trust the advice?
What incentives sit behind the recommendation?
And what might your adviser not be telling you?
Saving $20,000 can look attractive. But if conflicted advice leads you into the wrong property, overpaying, poor resale prospects or a compromised asset, the eventual cost can be many times greater.
Free advice can be very expensive if it leads to the wrong decision.
Free advice can be very expensive if the commission is built into the house price and you are financing it.
Frequently Asked Questions (FAQ):
Are free buyer’s advocates really free?
The buyer may not pay directly, but the adviser may receive a developer, builder, seller or referral commission. Buyers should ask who pays and whether remuneration affects recommendations.
Who pays a free buyer’s advocate?
Depending on the business model, payment may come from a developer, builder, project marketer, seller or another service provider.
Does a buyer’s agent have to act in the buyer’s best interests?
Yes, where the buyer has engaged the estate agent as their principal. Under Regulation 11 of the Estate Agents (Professional Conduct) Regulations 2018 (Vic), an estate agent must act in the principal’s best interests, subject to limited exceptions. The Regulations define the principal as the person who engages the agent to act on their behalf.
Does the person paying the commission automatically become the agent’s client?
Not necessarily. The key legal concept is who has engaged the agent to act on their behalf. Payment arrangements are still important because they can create incentives or conflicts and influence a recommendation, but buyers should separately establish who the agent’s principal is.
Can a developer-paid buyer’s advocate be independent?
Potentially, but buyers should establish whether the adviser can recommend properties that pay no commission and whether remuneration varies between projects.
Is it legal for a buyer’s agent to receive referral commissions?
Commercial arrangements can exist, but relevant disclosure and professional-conduct obligations apply. Buyers should specifically ask about rebates, commissions and third-party benefits. Consumer Affairs Victoria
How do I check if a buyer’s advocate is independent?
Ask whether they sell property, represent vendors, receive developer/builder/referral payments, and whether those payments influence the properties they can recommend.
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