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Selling Advice
Regardless of which agent you chose to manage the sale of your property, you need to be able to trust them and take their advice. That is why the decision as to which agent you list with is so important – so here’s some things to remember.
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Choose a successful agent
Agents who are selling a lot of property are in a much better position to truly act in your best interests. There are a lot of mediocre agencies out there who are basically ‘desperate’ for each sale. This is the last agent you want working for you. Choose someone who you feel comfortable with and someone who can offer you proof of their company’s recent, successful sales history.
Also, look for agent who will ‘add value’ to your property’s marketing exposure. Most agencies these days look to their sellers to contribute ‘Vendor Paid Advertising’ to their property marketing campaigns. There is nothing wrong with this, though some advertising can be quite expensive and to buy high-profile exposure for any product (including your real estate) might mean committing some of your own funds to the advertising campaign – this is very much an industry ‘norm’ today.
So in researching and interviewing agents to sell your property, you need to take into account their commission plus their proposed advertising costs.
A very simple example of this is that one agency might charge $9,000 commission to sell your property and want you to contribute $2000 towards advertising. Another agency might advertise “Free Advertising” with your property sale – even itemizing an impressive list of marketing initiatives, but their commission to sell your property will cost $14,000 – a simple analysis shows the agent with the “free” advertising is actually over 25% more expensive than the agent who asked for $2000 towards advertising.
So it seems to me that when a real estate agent asks you for a contribution towards the advertising of your property for sale, it is fair to ask them what they will contribute to your property’s marketing.
Elements like signage, window display, internet exposure and some forms of print advertising should all be available with no contribution from the vendor, and if the vendor is looking for ‘enhanced’ or higher-profile advertising, it seems fair that the ‘user pays’.
Often, agents who are using a high volume of professional marketing and advertising have access to resources which are simply not available to the public. They may receive ‘contract rates’ from publishers, so they are able to offer their clients good high-profile advertising exposure for costs which are significantly less than any member of the public would receive for a ‘one off’ booking with the same publisher. This is just one way that a good agent can add value to your property’s marketing exposure.
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Don't choose an agent on the basis of their appraisal
.....this has been a big mistake that a lot of potential vendors are vulnerable to.
The ability to appraise properties fairly and accurately is a cornerstone of good real estate agency practice. Again, look for agents who sell successfully and are achieving asking price or very close to it for their clients on a regular basis.
Regardless of what you believe your property should be worth, the simple truth is that either the lowest appraising agent or the highest appraising agent (or one in between) could be the best agent. Many property sellers have expressed the concern that after receiving a number of appraisals from different agents, they have been left more confused than ever because appraisal prices can vary so dramatically – as much as $50-100,000 for an average property. So look for hard evidence from these agents to justify their appraisal – and ask them to analyze it with and for you.
There are principally two types of evidence that agents might use for appraisals, broadly, they are the comparative and the competitive market. Comparitive sales involve comparing your property to other similar properties in similar areas which have sold in similar market conditions (the more recently, the better). There are various public record systems through which agents can source this data – and if your agent is selling successfully then they should have relevant, first-hand evidence of their own sales which they can produce as valuable comparative data.
The competitive market is simply comparing your property to others, currently listed for sale. Whilst it is interesting, these are less valuable comparisons, because it is easy to fall into the trap of comparing your property favorably to other over-priced properties that aren’t sold and wind up over-pricing unrealistically.
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So in a nutshell
Choose an agent you feel you can trust and then listen to their advice. Choose a successful agent, someone who can prove that they are busy selling real estate. Choose an agent who will add value to the marketing exposure your property receives, and choose an agent who can justify their appraisal – one who makes sense when they explain how they have arrived at their appraised price for your property.
Good luck with all your property dealings and if you have any questions, please contact myself or any of the expert team at Owner Property Group.
Merrick Keane
2007
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