When crowds of 20 or 30 people at an open home are no longer possible, how are agents weeding out tyre-kickers to get only the hottest prospects through the door first?
Since Auckland moved to level 3 restrictions in October, real estate agents have been permitted to show buyers through homes one-by-one, with appointments and strict health protocols in place.
“This was music to my ears, it would be wonderful to change the way people enquire about properties,” said Steve Koerber, Ray White Remuera’s top agent, who says he lives by American management coach Tony Robbins’ maxim ‘the quality of life is determined by the quality of the questions’.
“We don’t just ask buyers for their price guide, but also their likelihood of buying in the next three months, then that’s what I call qualified. It’s crucial right now to know that.”
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Koerber said that the most telling question is to ask buyers what they have bid on recently and missed out.
“If I know that, then I can really help. Everyone who calls wants to know ‘can I afford this property?’ If I know how far they missed out – if it’s by a massive amount, or just $5000 or $10,000 – then I know if they’re tapped out.
Buyers for a house on Clonbern Road, Remuera, are from other parts of Auckland so need to learn market values in a new suburb. Photo / Supplied
“The best thing a buyer can do is say ‘my price maxed out at $3m, should I look at this property?’ Knowing what they missed out on, and what they’ve looked at then I can really help.”
Koerber says that buyers holding cards close to their chest is no longer working, as agents can only give accurate guidance with full disclosure.
“If I say a place is $3m, then that wipes out some people off, but if I go to $4m, then that might wipe off too many. Right now, when we do appraisals based on the most recent market sales, even I wonder ‘is that too much, has it moved on that far?’.”
“And if people are just starting their search, then seeing a few properties in their price range helps them understand the market.”
Koerber pointed to a recently listed house on Clonbern Road, Remuera, that he and wife Nila Koerber are bringing to auction on November 19. The four-bedroom bungalow is near private schools, so is attracting buyers from beyond the suburb.
“At least 50% of enquiries are from Ponsonby, Herne Bay side of the city, families sick of the traffic to get kids to school. So, there’s some educating to do on values this side. It last sold four years ago for the high $2m, the owners have made improvements, so buyers who are calling have to be in that $3m to $4m range,” he said.
Market values are nowhere near their four-year-old ratings valuations in Remuera, say agents. Photo / Supplied
Koerber added that as the market dynamic changes, auctions are more likely to have two, maybe three, bidders not the five or more of earlier this year.
“People are no longer throwing caution to the wind, and not as many are buying before they’ve sold as banks toughen up in that $3m to $5m range. If they are buying first, they are now asking for long settlements, three months at least so they can sell their house. We’re past the Christmas period and into next year now.”
Bayleys Gary Wallace concurred that while the top-end buyers may have no limits, for the mid-range buyers – in Remuera, that’s $3m – agents need to check just what they can afford.
“Covid provides the perfect framework, I respectfully ask because viewings are very limited.
“People genuinely appreciate it. If they’re really tuned out of the market, some are looking at four-year-old CVs still thinking that is the value. “
He added that with buyers more focused now on settlement times, he advises vendors to extend out to three months or more to open up to more buyers who still have houses to sell.
A full day of one-on-one appointments for this house on Tiwai Road, Royal Oak showed intense interest in the $2m-plus property. Photo / Supplied
“People are just sensing a bit of tightening with the banks and interest rates.”
Barfoot & Thompson agent Linda Galbraith told OneRoof that establishing buyers’ price expectations involves setting realistic expectations.
“People see something at $5m to $6m that they were thinking they could buy for only $4m. You need to qualify people for a specific type of property, as well as price range.”
Galbraith said the speed of response to book viewings is a good indicator of the property’s appeal, and in turn what that might do to a sale price.
She knew that stylish townhouse by architect Ron Sang she marketed on Tiwai Road, Royal Oak, that had immediate, intense enquiry would do well. She booked a solid day of one-on-one viewings from 10am to 7.30pm the first Saturday after it was listed.
It sold at a brought-forward auction for $2.02m last week.
“We had an offer within 48 hours, but we waited until after the weekend to make sure that everyone who wanted to had seen it. Even then, it took eight hours on the phone calling everyone back so that no-one missed out. The pre-auction offer was $2m, there was a second bidder, but the original bidder went $20,000 above. We’d appraised it at that.”
She said that skilled agents’ appraisals understand where the price might land in this market, but she is still amazed at the discrepancy between agents.
“I feel sorry for the purchasers. I had one buyer who’d had valuations done on 30 houses. There’s no point wasting vendors’ time, our time, and buyers would rather do it this way too.
“We’ll learn to live with this.”
