Realtor Selling Tactics
Selling any property is a monumental decision; for many, it's seldom more than two or three times in a lifetime. And if the property is in another country, the real estate world is a labyrinthine landscape, and many sellers find themselves navigating uncharted territory. Here, we unveil seven shrewd strategies used by Australian realtors that every seller should be aware of before they start the selling process.
Beware the allure of low commissions. Agents may use this tactic to secure your listing and then rush to sell your property quickly, often below market value, to generate cash flow. Remember, a higher commission can sometimes secure a significantly better sale price. The top agents know their value, and seldom discount.
It is especially common and used by Managing Agents (your rental manager) to secure the listing, to shut out other (perhaps better) agents, and tie up the property on an exclusive basis (so you cannot use any other agent). Many vendors (sellers) still fall for the lower commission tactic. Say 1.5% commission instead of 3%, or similar. But even $50,000 extra in price secured by the higher charging agent, means the higher charging agent gets $1,500 extra instead of $750. So you "saved" $750 but it cost you $50K.
Agents understand human psychology and people’s desire to save money. They use this to quote a low commission to get you to sign.
Picture this: an agent walks in, flashing a dazzling smile, wearing an expensive suit, and confidently claims your property is worth more than its weight in gold. It might sound tempting, but be cautious. Some agents use this tactic to win your business, only to later force you into lowering the price repeatedly during the sales campaign. Beware of this rollercoaster ride and the ultimate reality check: the market value might be much lower than initially promised.
: One of my clients was told by the rental management agent that their property could fetch $1.1 million with renovations. The market assessment from highly regarded agents was $1 million. After investing $40k in repairs, $6k in marketing, and $5k in staging, they hoped for that magic number. Yet, reality bit hard, and it finally sold for $948k after much time and stress.
This costly error could have been avoided if the client had read my new E-book, "24 Mistakes Overseas Owners Make When Selling Their Overseas Property - And How to Avoid Them ALL" is now available On Line.
While some agents overquote, others 'underquote,' advertising a property for less than its true value to generate buyer interest. This is illegal and can cost buyers unnecessary expenses. Underquoting is illegal, because it forces buyers to pay for reports (building, pest, strata) and for legal advice and contract reviews on properties that would never have interested them if the real price had been disclosed. Often underquoting fails because if a property attracts limited competition, buyers are highly unlikely to raise their bid from the false advertised price to the real reserve price.
If your agent isn't providing regular updates or has scheduled your "Open House" at the same time as a multitude of others, beware. They may be stretched thin, focusing on chasing new business instead of giving your property the attention it deserves. Some of the larger agencies hold 20 to 30 open homes a week, all within an hour or two of each other. Which means the senior agents are more likely to be at the high profile home opens, leaving your home to the junior associate.
My E-book covers all these tactics and many more for sellers to be aware of BEFORE appointing an agent. This E-Book will help you avoid falling into this pitfall, by advising interviewing several agents and helping you to select one who will devote the required time and effort.
Or feel free to schedule a call. I am always happy to advise. I do not SELL your property, but DO provide advisory services to help you maximise your sale price, minimise costs, and not fall prey to thse or other tactics.
Realtor Tactic #5: Having a hidden agenda
You might think you and the agent are working with the same goal in mind: selling your home for the best price possible. So when your agent suggests spending tens of thousands of dollars on marketing, you willingly agree.
Remember, they use your marketing budget to promote their business. One agent told me ”The clients pay for all my advertising, promotion and publicity. It’s great!”
Realtor Tactic #6: Taking just one agent’s opinion
When it’s time to put your property on the market, you must interview several agents. Unfortunately, many sellers accept their first agent. Each agent will give you an estimate of your property’s value, and it’s possible these estimate might vary widely – often by hundreds of thousands of dollars.
The truth is it’s not an exact science. Real estate is subjective. It’s what a buyer will pay, and what a seller will accept. It’s that simple. If you are not comfortable “interviewing” agents, get a professional to assist.
Many agents now insist on exclusive rights to sell your property, locking you into a long-term agreement. While there are valid reasons for this, it may not always be in your best interest. Seek advice from an experienced advisor on this.
And it is especially common and used by the bigger, more successful agents. They simply won’t take your property on unless you give them “exclusive rights” to sell it for a period, often 3 months. And NO, the exclusive agents claim the marketing will "find all the buyers" is simply not accurate. This topic is too detailed, and complicated to go into in a few paragraphs. So seek professional advice before signing up exclusively with any agent from an independent and experienced vendors advocate before committing exclusivity.
Better yet, download (for FREE) my E-Book on the 24 mistakes sellers make when selling. Click on the link to download it.
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