Is This A Better Way Of Selling Real Estate?
We have all seen the ads on TV in recent times with an emerging trend of Real Estate companies who claim to do things differently when selling your property. Often insisting you pay less, receive more and sell your property for the highest possible price. Like many new trends though, the shine quickly fades when you pull back the curtain to reveal the reality. I have received feedback from some clients who have unsuccessfully tried to sell through these companies, and also drawing from my own experience when trying to buy through these agents; I have put together three factors to consider before buying into this new way of selling real estate.
You pay for what you get
You cannot compare apples with oranges as in the world of advertising, and it is critical that you compare like with like. An online presence is becoming more and more costly. It is not uncommon for a basic online advertising schedule with photos, floorplan, board, and brochures to cost you in the vicinity of $6,000. So you might want to ask yourself how a company can sell your property for a total of $7,500. It is very simple as it is not like for like. Often your online presence is only on their website or a very low grading listing on sites like realestate.com.au which leaves your property listing on page 10. To gain the listing on the sites you want, you often have to add extra costs to your advertising package.
No commission? Read the fine print
A few Real Estate businesses claiming no commission charges have found themselves in hot water recently for false or misleading advertising. Traditionally in Australia, a commission is only payable if the agent sells your property and is done on a percentage basis of the sale price, incentivising them to achieve the best possible sale result for you. However these new companies are charging a flat rate, but it is payable regardless of if they successfully sell your property or not. This only serves to incentivise agents to list your property but not to ensure it sells and certainly not to push for every last cent they can negotiate with the buyers.
Real Estate is not a property business it is a people business
After eighteen years as a buyers advocate, I have seen firsthand some of the best agents in the industry, and they all fundamentally understand this statement. Don’t get me wrong, strong market knowledge is vital but being able to engage with people, read situations and problem solve is what separates an average agent from a great one! When you engage an agent, you are employing someone to negotiate the best possible terms and price on your behalf as the reality is that they do this every day. Most homeowners will only sell three homes in their lifetime. Many of these fad companies rely on you dealing directly with the buyers yourself, and from my professional experience, this rarely works.
From both my perspective as a Real Estate professional and from the perspective of a property investor who has personally bought and sold many properties over the years, I fundamentally believe that the essential ingredient in selling your property is engaging the right agent who implements the right strategy for your home. Over the years, I have seen great homes sit on the market purely because the wrong agent was chosen or the wrong selling method and approach was undertaken. Make sure you look at the bigger picture and ask the right questions make sure you read the fine print.