Is hiring a realestate agent the right strategy for you?
Australia tends to have a love/hate relationship with realestate agents. Do we trust them? Not really. Do we hire them to sell our most prized assets? Often. But here's the thing. When it comes to selling property, there are several things realestate agents will be reluctant to tell you. If they do, they know they could lose making money on your sale, or risk landing the sale of your property altogether. But you have a right to be aware of these important points so you can make an informed decision about selling your home and the best way to do it.
The realestate agent's commission rate is negotiable
While an agent will tell you most clients pay a certain percentage rate, this rate is absolutely negotiable. The internet has made the job of a realestate agent easier than ever because buyers are so accessible. Think about that during your negotiations. Also consider the price range of your house. There's very little difference in workload when it comes to selling an $800,000 house to a $5 million house - yet the commission a realestate agent will make is considerably different.
Your marketing campaign supports their marketing campaign
Ever seen a house advertised without the realestate agency's branding slapped alongside it? Those expensive print campaigns you splash out on with your agent's logo one of the most dominant features? Have no doubt about it... realestate agencies do very well out of their clients' marketing campaigns.
Becoming a realestate agent is easy
In some states, the training and certification to become a realestate agent can be completed in a matter of days. Make sure you quiz your agent about their education and experience. Can they justify that huge commission?
Many houses sell themselves
There aren’t really any special tools that agents have that 'make' somebody buy a house. Buyers tend to buy houses they like and can afford. Present your home well and it will sell quickly and easily - with or without an agent.
These days, local market knowledge is available to everybody
Thanks to websites like realestate.com.au and Domain, you can get all the market info you need to sell your house; suburb snapshots, previous sales data, demographic info. For that little extra step, you can even buy the same detailed property and suburb reports from RP Data that realestate agents have access to.
An agent's 'database of buyers' is defunct
These days, buyers don't tend to sit around waiting on realestate agent's databases to find out about properties coming onto the market. Buyers that are in the market are constantly changing. They're also extremely active online doing their own research. This means, any buyers that are sitting on an agent's database are either no longer in the market, or they're easily accessible to you directly.
Some agents are guilty of pricing up your house
The real estate industry is extremely competitive. Agents have to compete against other agents to win your sale. They know that $$ speak and you’re more likely to sign with them if they value your home higher than the next agent. They also know they can gradually beat you down on price after you sign an exclusive agreement with them.
Some agents are guilty of pricing down your house
While this practice (what we call underquoting) is now illegal in most states, it's still happening. Underquoting is when an agent underquotes the value of your home to buyers to broaden the pool of interest. The problem here is, it aleniates buyers and wastes their time. And why advertise to buyers who simply can't afford your home?
They may pass on your enquiries to other properties
Believe it or not, yours is not the only property your agent is trying to sell. If they have a buyer who likes your property, but isn’t 100% sold, they may redirect this buyer to another property if they think it's going to be an easier sell.
Agents can compete with other agents from the same agency
Most agencies tend to split your commission between the agent who lists your home, the agency itself and the agent who sells your home. The downside is, agents may not refer buyers to the property of another agent within the same agency if they're likely to miss out on commission.
Agents do not handle your paperwork
It's actually your solicitor or conveyancer that handles all or most of the legal paperwork to do with your property sale. While some agents may fill in the front page of the contract, the solicitor does the heavy lifting and can do all of the work on your behalf.
An exclusive agreement bounds you to paying commission
Let's just say you introduce somebody to your property who ends up buying it, or you sign with another agent because the agent you signed an exclusive agreement with does a poor job. The problem is, under that exclusive agreement, you may still be entitled to pay commission - no matter whether your previous agent found your buyer or not.