John McGrath – How to choose an agent this Spring
Choosing the best agent to sell your property is the second most important decision in real estate (after choosing the right property to buy). But from my experience, many people are too casual in their approach to this crucial decision. They interview a couple of agents and choose the one who gives them the highest valuation or has the lowest commission fee.
There’s a lot at stake, so it’s worthwhile putting some time and effort into researching your choices. Because choosing a mediocre agent who offers a discounted commission or gives you an inflated valuation of your property is a mistake that can leave you seriously out of pocket.
The sale price of your home is going to come down to the net result of your agent’s skill, effort and experience. The difference between an unskilled agent and a very good agent could easily amount to a 25% to 30% difference on your sale price.
When you’re choosing an agent, the most important criterion is their ability to maximise the sale price. The skillset you’re looking for includes creative and targeted marketing, outstanding auction strategy, superior negotiation skills, and the ability to get into the hearts and minds of buyers and get them excited about owning your property.
Your agent must be capable of marketing your property to the maximum number of buyers. The number of buyers introduced to your property has a direct relationship with the sale price. A good agent will have a large buyer database and will be able to sell the benefits of your property and clearly articulate its advantages over others in the market.
A good agent has credibility and a solid reputation in the community, so when they say something, buyers listen and take their advice onboard.
They can put together an effective auction strategy and conduct a successful auction. If you’re selling by private treaty, you’re hiring an agent for their negotiation skills. I believe a good agent can gain an extra 10% to 15% in the negotiation phase alone.
The first step in the research process is to draw up a shortlist of agents to interview. It’s a good idea to talk to at least three agents.
Firstly, seek recommendations from friends, colleagues and neighbours.
Then investigate who the dominant agents are in your area by seeing who has the most ads and recent sales listed on the major real estate portals. Consider smaller, boutique agencies as well as it never hurts to canvas a variety of opinions.
Review the quality of their marketing by first looking at their agency’s website. Audition them by visiting a few open homes and auctions.
Then pick your three agents to be interviewed. The usual arrangement is for them to come to your home so they can inspect your property and answer your questions. They will then either send you a listing proposal, or they’ll ask to meet you a second time for a formal listing presentation.
Here are the key questions to ask an agent:
- How long have you been working in this area?
- What comparable homes you have sold in this area lately?
- What is the state of the market?
- How long is it taking you to sell well-priced listings at the moment?
- How much is my home worth? How have you come up with that figure?
- Should I sell by auction or private treaty? Why?
- What marketing strategy do you suggest? Why?
- What will you do to introduce buyers to my property?
- How does my property present? What should I do to maximise the sale price?
- Do you have a list of recent vendors I can speak to?
When making your decision, don’t just pick the agent with the lowest fee. If they’re incapable of negotiating a decent fee, reflective of their skills and talent, how are they going to negotiate a top price for your property?
With regard to what your home is worth, go with an agent who bases their estimated selling price on tangible facts and recent sales of comparable properties. Ask for a list. Some agents will inflate their appraisal in the hope of winning your business. It’s called ‘buying the listing’. Don’t be fooled!
Lastly, consider the chemistry between you. The nature of the agent-vendor relationship is quite intimate and requires a lot of trust. You need a solid rapport because you’re going to be working very closely and you’ll need a high degree of confidence in their recommendations and advice.
Your choice of agent is always a crucial decision, but it matters even more in a cooling market. Great agents know how to navigate these conditions to continue achieving strong sale prices.
It’s really worth your time and effort to make sure you find the right agent for you.