Home sellers commit the biggest mistake in choosing their listing agent when they base their decision on just two criteria: the highest list price for the home and the lowest commission.
On the surface, those two are good criteria because any home seller would want to aim for those things. However, they have very little to do with hiring a listing agent and is irrelevant in many ways. Here’s why:
The Highest Recommended Selling Price
The truth is agents can’t tell you the amount your home will sell for. They can provide you with data on comparable sales, pending sales and active sales. However you decide on the sales price and whether it’s the right price is up to the buyer. An agent can give a suggested listing price, among other things, that will attract buyers. How it moves forward is up to the buyer and how well your agent negotiates with them.
Choosing a listing price may sound frightening but it is possible for you to choose the right listing price. You have to do your research and work with a reliable listing agent.
Here are some things you may consider when looking for a listing agent:
- Agents don’t have crystal balls but can provide you with a realistic price where your home may sell. Beware of the agent who suggests the highest listing price …. Ask the agent to provide you with data supporting the recommended listing price – they must provide you with evidence. If they can’t or if the home sales are in a different suburb you probably should be aware.
- You can trust a listing agent that provides you with a range of prices. This range cannot be greater than 10%. This number is determined by several factors, including location, the features of the property, the temperature of the market, the condition of the property and upgrades in the property.
- There is an art to pricing. A home that is priced right will get multiple offers if the buyers are active in the market. If the price is a little high then the offers that come in may be lower than your expectations. If the price is too high, then you run the risk of no one showing up to inspect and you’ll then be forced to lower the price, leaving buyers thinking what flaws your house may be hiding.
Choosing a Listing Agent Based on Commission
Despite what you may think, each real estate agent is unique. Each has their own marketing and advertising methods. By hiring a listing agent and selecting an advertising budget your home will be seen by a large number of buyers. This is good, because the greater the number of potential buyers reached, the higher the chances of your house getting a better offer.
There is always a reason why a listing agent would work for a cheap fee. It might be they’re desperate for business, they may be inexperienced, lacking confidence or they may be pressured from their employer so they can hit their KPI’s keep their job. Find out why they are willing to be cheap before committing to hire an agent.
Why is Marketing Important?
The property marketing of a home is the most important thing to consider when selling your home. If you don’t get the buyers there then in the first place, then it won’t matter how good or experienced your agent is when it’s time to negotiate. Make a request to take a look at the agent’s marketing strategy. Make a point to ask what the agent’s strategy is for selling your home.
Here are a few marketing techniques you should expect:
- Professional signage – including the agent’s contact number
- Digital targeted marketing
- Ads in local magazine
- Multiple listing service
- High definition video presentation (not slides to music)
- Distribution to major websites
- Full-colour brochures
- Floor plans with dimensions
- As many open homes as needed (not limited to two)
- Directional signs for open homes
- Direct mail to nearby suburbs & out-of-area buyers
- Feedback phone call to sellers on every buyer inspection
- Follow-up reports on buyers inspections detailing feedback in writing
- Email feeds of new listings that compete
- Updates on neighbourhood facts, trends and recent sales
- Note that no single marketing technique works; it’s a combination of these techniques that sells properties.
Good Listing Agent Characteristics
It’s important to have a good working relationship with your listing agent. Here are some of the qualities you should look for in an agent:
- Relevant education – Are they a Licensed Agent or an Assistant Real Estate Agent (who hold a certificate of registration only)?
- Experience in marketing homes – Having a diploma in marketing is a huge advantage
- Excellent negotiating skills
- Results – What is the average days on market?
- Results – What is the average percentage over the asking price obtained?
- Wide network; contacts with other agents
- Excellent communication skills
Lastly, request for a personal guarantee. Look elsewhere if the agent refuses to provide a guarantee of performance letter.