There’s an old legal saying, attributed to Abraham Lincoln: "A man who represents himself has a fool for a client." The same thing could be said about real estate sales.
If we bother to think about real estate agents at all, our general impression probably isn’t particularly flattering. But on a one-to-one basis, our view of real estate agents is often completely different, and in that respect they’re a bit like politicians. We slag the profession as a whole,but we all know a really good one who is the exception to the general rule.
But here’s the thing: they’re an absolutely essential part of the real estate sales process. If you doubt that, try selling your own home. Unless you’re the one in a 100 who has the skills to make it work you’ll more than likely end up with a sub-optimal deal at a lower price than you could have achieved – and that’s assuming you manage to sell your property at all!
The reality is that agents take most of the burden of selling off your shoulders. They advise you on market value, they handle the promotion of your property, they generate interest and field enquiries, they stage open homes, they negotiate with potential purchasers on your behalf, they protect your interests within the minefield of legal requirements that now form part of the sales process, they arrange the physical hand over of the property on settlement - and they’re there to provide counsel and advice throughout the process.
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But as with any profession – there are good ones and not so good ones. So how can you tell the difference and what should you look for in an agent?
Here are five general rules:
Rule No. 1: Talk to a few agents before you sign a listing agreement.
Unless you’ve been referred to an agent on the endorsement of someone you trust and who has used their services – it’s a good idea to ask three or four agents to pitch their services to you.
Rule No. 2: Don’t list based on the highest price promised.
Sadly, and particularly in flat markets, there’s a tendency among some agents to "buy" business by promising to get a better price than others – then conditioning you to accept a lower offer once the listing is secured. Often, this means that a more experienced and realistic agent misses out on the business and you end up with a lower sales price than you could have achieved.
But if you’re not listing on price – what should you be looking for?
Rule No. 3: Check the agent's sales history.
As a general rule, someone who has sold more houses is going to be a safer bet to sell yours – so ask to see sales volume (how many houses they’ve sold in the past 12 months) and sales prices (what those properties have sold for). There’s no hard and fast rules on what you should look for in respect of either of these because volumes will vary depending on location – and price is a subjective thing – but an Agent with a solid record of consistent sales who is selling houses that are similar to yours at a price level you’d be happy with is probably a safe choice to list with.
Rule No.4: Check the average time to sell.
Find out the average time it takes to sell a property in your area – then ask your potential agent how long she or he takes to sell a property, on average. The importance of this measure will depend on other factors such as whether you’re buying another property – but if speed is of the essence, select an agent with this in mind.
Rule No. 5. Check experience and area knowledge.
While there are exceptions to this last rule – you’re generally wise to appoint an agent who has been around for a while and who knows the area your house is in.
- Ashley Church is the former CEO of the Property Institute of New Zealand and is now a property commentator for OneRoof.co.nz. Email him at [email protected]
