Let your Real Estate Professional take the risk!
IF AN AGENT IS CONFIDENT TO FIND YOU A BUYER AT A PRICE YOU ARE WILLING TO SELL AT, WHY ARE YOU AND NOT THE AGENT PAYING FOR THE ADVERTISING IF YOUR HOME DOESN'T SELL?
Scott Collins @realty believes that the agent you select to sell your biggest asset should be a professional, and a true real estate professional should be able to do the following:
Competently research and deliver a realisitic estimate for the value of your home.
Demonstrate how they can negotiate the highest possible sale price.
Take as many risks away from the seller as possible by agreeing to pay for the advertising should the home not sell.
Consider the following:
Below are just some of the lines home sellers hear when the topic of marketing comes up:
“You can’t sell a secret”; “You should invest at least 1% on the advertising campaign”; “You need to cast as wide a net as possible”; “ You need to spend money to make money”; "It's a numbers game"
It is important to consider that some agents are tempted to acheive two things when suggesting an advertising schedule:
Build their own professional profile with big marketing campaigns.
Get the seller committed by making sure they agree to spend as much money as possible upfront.
Have a look at the suggested marketing campaign below. Most of which is for the purpose of achieving the above two goals:
When a campaign like this is shown to the prospective sellers, it is delivered to the seller with certainty, confidence and an insistence that every aspect is necessary to ensure that the best buyer is found.
Now imagine it's a month down the track and the auction has just gone silent. The price the seller was promised hasn't been reached and now there is a crowd of buyers and curious neighbours waiting outside. The agent walks in and proceeds to tell the seller how "you need to meet the market" and "if we don't sell now we will need to run a new advertising campaign". They are essentially being given two choices:
Accept a lesser price than you were promised or pay the $9000 advertising bill.
If they accept less and sell, they can move on. If they hold their ground and refuse to sell, then they must pay the current agent out, find a new agent, and potentially, go through the same process again.
The pressure is so high at this stage that most people give up and sell for whatever the market provided them on the day.
What if you refuse?
There are some circumstances where a seller, so incensed by what has happened to them, stands their ground and tells the agent that they refuse to take the lower offer and also refuse to pay the marketing bill. They do this because they feel justified - "the agent didn't fulfil their promise, so why should we have to fulfil ours?"
This is where the relationship between the agent and seller can really take a turn. The unethical agent now has one last trick up their sleeve that will turn the screws on the seller and force through the sale. The threat of debt collectors and the lodgement of a caveat on the property.
Below is a letter that was sent to a lady who had been through the scenario detailed above and decided to hold her ground. When you read letters like this, there it is no suprise that agents have developed a bad reputation:
So what is the solution?
In no way is this page intended to characterise every agent you meet as being as unethical as this. However, be very wary when an agent makes price promises that seem too good to be true and then asks you to pay for the advertising costs irrespective of the result.
As a lot of the marketing products available are more targeted towards boosting the agent's profile, ask the agent how each item will find more buyers. When you look closely you will discover that it takes a lot less than you think. The golden rule to protect yourself is:
Never commit to paying any money for commission or advertising unless you receive an offer you are happy to accept. At Scott Collins @realty we commit to the following:
There are absolutely no charges for commission or advertising UNLESS SOLD.
Want to know more?
Tel: 0499 005 265