Cheap and (not so) cheerful “no commission” agency model, Purple Bricks was in the news again this week advising that their standard fee will be now be close to $9,000, up from their original offering of $4400. The fee gap between using a service whereby the “agent” has no incentive to achieve a sale for the vendor and a professional, REIWA member agent who’ll do the job properly (and be remunerated accordingly) just got narrower.
The cost of a proper real estate service is relatively substantial in dollar terms albeit small in terms of percentage of the selling outcome. Unfortunately, would-be sellers sometimes begin their search for the right agent based solely on this fee. Occasionally, before introductions are made and names exchanged, the seller asks, “What is your fee?” This is a poorly timed question.
Intending sellers ought to contact an agent and begin with finding out about their services. Ask for a market appraisal which, when completed, ought to include (amongst other things) a likely market price, comprehensive details of what services the agency offers, a marketing strategy and a fee proposal.
Since fees were deregulated in November 1998, selling fees as a percentage of the selling price have not changed much and agents are obliged to inform would-be clients that their fees are negotiable. And this is where consumers ought to do just that; negotiate.
When negotiating a selling fee, it is wise to have first chosen your preferred agent. That way, your decision to choose an agent is based on your impressions of their professionalism, conduct, experience, marketing plans and abilities. It is a clichéd parallel perhaps but you wouldn’t choose the cheapest surgeon if you knew them to not be as proficient as one marginally more expensive. The outcome of buying decisions based on cost alone is usually a poor one; a result equal to its value – low.
Most agents, faced with the prospect of listing a quality property and working with genuine sellers will be happy to negotiate a fair fee. Importantly, the manner in which the agent negotiates their fee provides an insight into their skills as a negotiator; an important trait when negotiating your property’s sale.
Would-be sellers ought to discuss fees with their agent in an honest and candid manner but remember that the agent’s job is to achieve a sale in the shortest possible time for the highest price the market will bear and an attractive remuneration is a powerful incentive to maintain your agent’s focus.
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