10 Tips When Choosing a Real Estate Agent to Sell Property
Are you about to sell property?
Vendorable helps you find local and specialist agents by creating a market for your listing. Publish a request for tenders and agents will start bidding for your job. Each bid will provide you with a complete service offering, including appraisal, costs, and any special knowledge the agent might have about your property and the surrounding area.
This beats using the telephone or face-to-face for efficiency and ensures you are equipped with the information you need to make a smart choice.
What are some factors which might impact your decision?
1. Agent location
How close should a real estate agent be to your property?
Real estate agents are more mobile than ever. Agents are now willing to visit you at a time and place convenient to you. But with agents covering larger areas how far afield from your property is too far?
On Vendorable real estate agents specify the range in which they work by a measure of distance from their home office. This indicates the areas agents are most familiar with and suited to working in.
When you add your property to Vendorable you are presented with a list of nearby agents. These agents are already using Vendorable, close to your area and want your work.
There might be more than just a few agents near your property so be sure to ‘shop for agents’ for more options.
You’ll also be able to specify when you go to market for services just how far away you’re ok with your agent being.
If you know a real estate agent nearby but can’t find them on Vendorable you can add them directly via their email.
2. Sales history and performance
Has the agent provided you with comparable sales in your area?
In some jurisdictions a list of comparable sales is required to be given to you by law when an agent is pitching for your work. But this is not the case everywhere and regardless of regulation a good agent should be able to show you:
- Properties they have sold recently
- Property sales that are comparable to your own prospective property sale
- Explain deviations of price from the average for sales in your area
On Vendorable, agents typically provide this information to you in a PDF.
Agents can also address questions about your property when providing their service offering.
3. Appraisal check
What is the value of your property?
Appraisals from real estate agents are not independent valuations from a valuer. They can, however, be accurate. The trap to look out for is where an unscrupulous agent prices your property above market in an attempt to win your work.
So how do you know?
Getting several opinions helps you find the answer to this.
Taking the average of those appraisals and looking at the lowest and highest estimates for your property will steady your expectations.
Vendorable conveniently does this for you and presents it in an easy to read format.
4. Fee structures
What are the pros and cons of fluid and fixed commissions?
Fixed commission is where the agent’s service fee for selling your property does not change even though you don’t know what price your property will achieve.
By contrast, a commission based on the percentage of the sale price does change. As the price goes up, so does the service fee.
Watch out for what agents call a ‘ratchet’ or ‘incentive clause’. This is where an agent takes a significantly higher percentage of the proceeds above a certain threshold. For example, you pay the agent 10% in every dollar achieved above $700,000. From an economics perspective, this is not in your favour!
The price of your property will mostly be market driven. There is only so much that an agent can do to achieve a better price. If the agent sets the ratchet threshold below what they know the market can achieve they have just gamed you on commission.
A percentage commission should be all that is required to incentivise an agent to obtain the best possible value for your property. In some rare cases a ratchet is appropriate but not for the majority of properties.
5. Marketing costs
Who is bearing the costs of marketing?
Real estate agents should disclose the costs of marketing your property and who is paying for them.
Advertising costs can include:
- Print (local & national) and digital advertising
- Signboards and open for inspection signage
- Photography, videography, floor plan and virtual tours
Other costs will include all fees that don’t relate to advertising the property. For example the auctioneer’s fees.
Vendorable requires agents to disclose these costs and provide an easy-to-read breakdown in their submission.
This ensures that it is clear who is paying for what and what will be delivered.
It also gives you an opportunity to go back to an agent, if desired, and request to either add or remove some or all of the optional extras that they may have suggested.
6. Market intelligence
Does the agent have special information about your prospective sale?
Signing with the first agent you encounter may not deliver you the best price for your property, or they may not deliver a sale in your preferred time frame.
Why might other agents be a better choice for you?
Here are some examples:
- the agent knows of buyers who missed out on a similar house down the road;
- the agent is already conducting another sale with clients who would be keen to downsize into your apartment;
- the agent also sells for a developer who would pay a premium for your site which has recently been rezoned; and
- supply is scarce at this point in time for properties like yours in your area and you can command a premium.
Vendorable allows you to crowdsource information from agents at large, cross-reference their claims against each other and make an informed decision. You are in control and shielded from being hustled.
With the power of contemporary Internet communication, you do less to get more information and understand what it means.
7. Marketing strategy
How is the agent planning to market your property?
A good real estate agent will outline not only how they intend to market your property but why they are proposing this strategy.
There are many factors that affect a marketing strategy:
- Real estate market conditions
Strong vs. weak market conditions could mean an agent might suggest an auction instead of a private treaty or vice versa. - Timing of the sale
For example, if you cannot wait for an opportune time of year to start marketing, an agent may suggest private treaty as opposed to auction given fewer prospective buyers turn out closer to key holidays. - Condition of the property
If you’re selling a property in poor condition or ‘as is’ the agent may suggest an auction to create competitive tension between bidders rather than competitive tension for the quality of the property. - Size of the property
Large blocks of land and high value properties tend to be sold by Expression of Interest or if via auction, typically in private rooms. - Zoning
If your property has unique zoning that may attract developers as well as private buyers, then your agent may suggest an Expression of Interest or Tender Campaign as disparate buyer groups may not behave uniformly at auction.
8. Expected timeline
How long does the agent think it will take to sell your property?
Your agent should give you an estimate of how long they think it will take to sell the property. It’s important to remember that this guidance should be more than simply the estimated timeline to sell.
Some components of a proposed timeline might include:
- Days to prepare the property for sale
For example, your property may require clean up works such as garden maintenance, or re-painting or re-carpeting certain rooms. - Days to prepare and confirm marketing material
For example, it may take a few days to prepare a print advertisement and then a week for flyers to be printed. - Days of marketing
This is the time from when the property is first listed to the time a contract is exchanged. For example, a 4–5 week campaign followed by an auction - Days to settle
This can be based on the buyer’s ability to close. For example, buyers in the area may be typically approaching agents with offers conditional on financing.
This timeline information is included in the Strategy portion of the proposal as outlined above.
Updates on this information are required in the Vendorable workspace as part of Vendorable’s mandatory Reporting to sellers. This is outlined in the next section.
Remember, whilst an agent may tell you that houses are selling in your area in ‘a week or so’ that’s not actually how long the process will take.
The best agents will set your expectations with regards to the actual time it will take for your property sale right through to completion.
9. Reporting
How often will an agent update you?
Real estate agents engage in a number of activities during the marketing phase:
- Preparation and presentation of the property for marketing
- Production and distribution of marketing materials
- Inspections, private viewings and online enquires
- Buyer screening and provision of documentation
- Conducting an auction
Vendorable makes it easy for real estate agents to record all this information in a cloud workspace to give sellers real-time updates on how the sale is progressing.
10. Background check
Verifying an agent’s credentials is important
Here are some potential ways you can verify an agent’s background against what they’ve put forward in their proposal:
- Check their Vendorable profile
- View their recent listings via the links on their Vendorable profile
- Check your government website and confirm their license details
- Ask for testimonials from recent sales within the last 3 months
Vendorable’s agent profile provides you with extensive information to verify an agent’s credentials and recent performance.
How to get started
If you are about to sell property, Vendorable can help
- Go to vendorable.com
- Sign up and create an account
- Add your property
- Start the sale process by advertising your opportunity to agents
