I work with two amazing Principals, Peter Secco and Jacob Secco at RE/MAX Executives. These two have more knowledge and experience under their belt than all the Agents in other offices and their words of wisdom resonate deeply with me and the way I like to do business.
Recently Peter mentioned a real estate purchase he had made in 2003 where an Agent was selling it with minimal advertising (he had not asked the Seller for any marketing money - which the Seller *thought* was a great saving) and was asking for a high, but fair market price of $395,000 for a 3 bed home in Holland Park.
The Agent handling the deal had not listed it online, had a small 'For Sale' sign out the front, was not conducting Open Homes and had people view the property via Appointment Only. As a result, Peter was one of 5 inspections on the property.
Peter offered this Agent $350,000 which was initially knocked back as being too low. After a few weeks, the Agent called Peter back and asked him if he would consider paying $375,000.
Peter declined and said he was firm on his $350k offer.
A few weeks after the last discussion, the Agent called Peter again (obviously there weren't any other offers) and asked him if he would consider offering $360,000 for the property.
Peter made an offer of $355,000 and it was accepted.
What happened next is where Peter really showed the power of a good Agent who ensures that there is hard work and excellent marketing done to get the best price for a property.
Peter tidied up the property by mowing, edging, clearing leaves/branches and power washing the hard surfaces. He had a professional cleaner in and washed the windows.
Then, he put up a bright photo sign out the front, had professional photos taken and a floor plan drawn up, listed it online in our 13 different locations (some paid, some free), printed brochures, invited neighbours with paper invitations, door-knocked the street to let them know and put it in the local paper and window at RE/MAX Executives.
He conducted two Open Homes with around 30 total inspections.
On the second Open Home, Peter had multiple offers and sold the property for $415,000.
That's $60,000 more, just 1 month later with only an initial outlay for tidying and marketing the property. Even taking the commission from this profit, it's a huge difference in price: almost 17% more, in fact.
If that first Agent had asked for marketing costs up front from the Seller, they would have been able to secure a higher price in a few weeks.
Instead, it stagnated on the market and was snapped up by a savvy investor.
I can guarantee you would prefer that extra money in your pocket when selling your property and would be devastated to have missed out on that due to having an Agent who might be 'cheap' but doesn't save you money.
Imagine, with the market the way it is today, if you were selling a house for $650,000 (which is becoming the average price in our area), and you were to go to an Agent like first one in this scenario. You might only be selling for $555,000.
Pay for your marketing, and get great Agent who works hard for you and the sale of your property and you could find that you make that extra 17% and you'll be selling for around $100,000 more.
What would you do with $100,000?
The following is a further explanation from Peter about why you should never skimp on Real Estate costs when selling your home.
"With the Real Estate Industry changing over the last 5-10 years we have seen a huge emergence of smaller 'One Man Band' agencies, agents offering low fees in return to 'assist' vendors with the sale process and agents virtually operating from their cars and homes.
I find that these agents tend to use low commissions and no advertising costs. as their major point of difference to secure your listing. I have issues with this process when we are continually bombarded through media and advertising on how to save costs on virtually everything we consume; and why not, if you can save money?
But I do not believe property comes into this category!
I would be scared if my agents strongest attribute is 'I'm the cheapest' and I'm about to list my biggest asset with them to hopefully negotiate the best price in the market. I don't believe the low commission agent has that ability, as a competent negotiator would not compromise their fees!
I believe it could be a costly mistake to simply sell your property based on the 'best deal' a particular agent offered because with properties now selling between $550K and $1M+, an agent who does not have the resources, profile, know-how or exposure to maximise the number of buyers through your property can cost you dearly, because as little as a 5% error in the final sale price at this level will equate to a loss of between $25,000 and $50,000.
Just as a high profile, skilled negotiating agent makes sure every potential buyer comes through the property, they may even secure 3-5% 'above' the market making the gap between an ordinary 'cheap' agent even wider ($50-100K)."
Thinking of selling your property?
I am happy to come and see you to give you an appraisal with no obligation. An appraisal with me can give you expert industry knowledge about what’s happening in the local area of your property, information about any recent changes in the market along with some examples of what services you can choose when selling your property with us.
With a fair and ethical mindset, you can be sure that together we achieve the best possible sale experience for you and your future!
Kath is an Annerley and Tarragindi local with all the inside knowledge. Ex business-owner and current lover of local, community and Real Estate!