Being a real estate agent is a funny business. We don’t actually work for ourselves. We work for our Vendor. We effectively have to “apply” for the job of selling every property with each individual Vendor. In a very competitive market, we’re often up against stiff competition with other agents vying for the same “job”. As a Vendor, you need to make that very important decision of who you are going to hire to sell your biggest asset.
To help you with that process, we’ve put together some questions you should be asking a potential agent:
1. How long have you been a real estate agent?
An agent with years of experience brings with them a wealth of knowledge such as juggling a number of priorities, being intuitive with potential buyers and knowing how far to push for a better price or terms of a contract, understanding what motivates people, and knowing how to read a situation and obtain the optimal result for both Vendor and Buyer. An inexperienced agent however can bring incredible energy and enthusiasm to the table, in their desire to break into the industry and start to develop their reputation. Ideally a combination of experience, expertise and energy means you get an agent who knows what they’re doing and works every job with intensity and vigour.
2. What is the market doing?
This is probably the most common conversation which takes place at a dinner party as soon as somebody finds out there’s a real estate agent present. A knowledgeable real estate agent should be able to give a broad overview of the current landscape in terms of what’s happening with prices, how is the market being affected with changes in government policy, banking regulations or interest rates, what are auction clearance rates like, and numbers of enquiries and inspections at open homes.
3. What do you think my property is worth?
Nobody knows their property better than a Vendor. And never before has there been more tools available for a Vendor to be able to research property prices to determine what their property might be worth. But a real estate agent will be able to provide further insights into sales prices of surrounding properties and how they compare to yours, and current market sentiment. A real estate agent should be able to provide you with a top figure and a bottom figure range, which hopefully falls in line with your own estimate. The information that a real estate agent provides should be evidence-based by giving you comparisons of other similar properties, along with their own experience of the market and discussions with Buyers.
Avoid agents that “high ball” your property by over-shooting the price by a substantial margin just to make you feel good. They are simply “buying” your listing just to win your business. This results in listing at a price that is not achievable, spending an unnecessarily lengthy time on the market, and the agent slowly destroying your price expectations during the campaign. If a property is on the market for an extended period of time, there’s a good chance it’s missed the boat and will achieve less than the optimal price because of all the time wasted being over-priced at the start of the campaign.
4. How long will it take to sell my property?
A real estate agent should be able to explain that the first weeks on the market is the strongest time for buyer enquiries. The property is fresh and depending on the marketing strategy chosen, it will be at the top of the “pile” for a period of time. A real estate agent will be able to provide you with the average days on market for other similar properties, and what their expectations might be with regards to how quickly your property will sell. They should also have a contingency plan should your property not sell as quickly as anticipated. This may involve a change of strategy in terms of method of sale, marketing, or pricing. Your agent should work hard to avoid having your property on market for an extended period, as Buyers will be looking at fresh listings and therefore wondering what is wrong with your property that is preventing it from selling.
5. Is there anything I need to do to sell my property quicker?
Whilst maintaining diplomacy, your real estate agent should be able to give you an honest response on what, if any, changes they recommend to better present your property. This may involve styling tips and general maintenance. It could mean giving the property a thorough clean and declutter. They may even recommend that you not undertake the kitchen renovation you’ve been considering because you may over-capitalise and not recoup that investment in the sales price.
6. How will you market my property and what will it cost?
The options are endless, as can be the costs, to marketing a property. Ideally you want your real estate agent to listen to your needs and understand your budget and customise a marketing package which suits you and your property. You can’t sell a secret, so your real estate agent will be working towards maximum exposure in a number of medias which may include print and online.
7. How will you sell my property?
There are a number of methods of sale including private treaty, auction or tender. A property can be marketed at a specific price, a price guide such as “offers over”, or no price at all with “contact agent” in the advertising. An auction property has no price and as the auction date approaches, a “reserve price” can be determined depending on price feedback that the agent has obtained during the campaign. Some real estate agents may have a preferred method of sale depending on what suits them. However the method of sale should be determined by factual evidence and what suits your particular property and market, which a good real estate agent should be able to clearly explain.
8. What commission do you charge?
Commission levels can vary quite significantly. Again, be warned against agents who want to “buy” your listing by under-selling their services. The old adage often applies that “you get what you pay for”. Cheapest is not always the best. A good real estate will be able to justify the commission they charge in exchange for a superior level of service. A small difference in percentage of commission can be far outweighed by a fantastic price achieved by a hard-working agent. The journey towards reaching that price is also relevant. Your real estate agent will communicate with you to keep you informed throughout the campaign, which will reduce stress levels caused by not knowing what’s going on. Should the sales process achieve all that you desired, then your real estate agent will have earned every cent.
9. Will I like you?
Not necessarily a question you would ask straight out, but during the course of your “interview”, you will have determined what sort of relationship you will have with your real estate agent. The real estate agent may have ticked all the boxes when it comes to experience and expertise, but they should also satisfy the “x factor”. This includes:
- Trust – do you feel that you can trust that they will be honest and truthful about how the campaign is progressing and what buyers are saying about your property?
- Personality – are you comfortable with them and is there good rapport whilst still maintaining a professional relationship?
- Confidence – after everything they have told you, do you have confidence in their ability to get the job done?
Your real estate agent may have a great reputation or may have been recommended by a friend or family member, however it’s ultimately up to you to decide if they are the right agent for you.