Do’s and Dont’s When Dealing With Real Estate Agents

Read time: 4 minutes, 09 seconds.

An unlikely result of the pandemic was Australia’s housing market boom. 95.7% of sellers sold their homes for more than the initial purchase price. With this trend expected to continue into 2022, you may consider this the right time to sell your property. However, timing is everything. Though others may have found success in the real estate market recently, your case could differ. Before selling your property, you’ll want to consider how much money homes selling for in your area. After all, that’s a good indication of what potential buyers are willing to spend on your property. 

Around 5-10% of properties in Tasmania were sold privately in 2019. It’s perfectly legal to sell your property on your own in Australia. Going the private route is attractive for a variety of reasons. You’re able to save on agent and agency fees. Plus, platforms like Gumtree and social media websites make this process convenient and simple for users. People reported that they were driven to these avenues after being unsuccessful with real estate firms. However, privately selling comes with its own set of risks. Past President of the Real Estate Institute of Tasmania, Tony Collidge, warned that the biggest risks were legal problems arising, particularly around failures in disclosing information relevant to the sale. Things get a bit more complicated when it comes to negotiating with a prospective buyer. He also went on to add that in general, real estate agents can secure higher prices for properties. They have access to databases of potential buyers that individuals do not. “Good agents are able to introduce a number of buyers to a property and then try and force those buyers as high as they can.”  – Tony Collidge, Past President of the Real Estate Institute of Tasmania

Leaving the heavy lifting to an agent doesn’t mean our work as property owners is done. There are several ways to increase the likelihood of a positive outcome. Below are some do’s and don’ts to help you through the process of selling your property through a real estate agent.

Your number one priority should be finding someone that can sell your property at the highest price. Going with the lowest commission could see you losing out on massive profits. Instead, base your choice on their knowledge, background, and ability to close sales in a timely fashion. Do your research online to find local agents, backed by a history of good results.  Shortlist the licensed real estate agents who have sold properties similar to yours, and thoroughly vet them. Also, inquire about how long it will take them to sell your property. “Metrics like average days on market or auction clearance rates are incredibly important when selecting your agent.”  -Michael Townsend, Principal, McGrath St Kilda

Set realistic goals for the sale of your property. If homes in your neighbourhood are selling for 1 million on average, pricing yours at 3 million doesn’t make much sense. Real estate agents should advise you on their estimated selling price, commission fees, and marketing plans. Listen to their advice and ask as many questions as possible.If the process is going slower than you originally anticipated, ask how you can help. They may suggest lowering your selling price. Remember, they want to sell your property as much as you do. If they suggest investing more into advertising to increase visibility, it may be worth the consideration. 

As the rate isn’t set by law, negotiating it is within your rights. Throughout Australia, real estate commissions typically range from around 1.6% to 4% of the property’s selling price.  Please note that commissions can only be negotiated before your property has been sold. So it’s smart to shop around for the best rates before approaching a real estate agent. It is advised to get quotes from at least 3 real estate agents before making a decision.
After settling on fees and costs, best practice is to ask your agent to provide written quotes detailing: 

• – Rate of commission
• – Marketing charges
• – Any additional fees 

Along with protection, this provides property sellers with the opportunity to prepare financially for the process. Real estate agents increase our chances of finding a buyer fast and selling for the highest price. However, these gains can only be realised when we engage in prior research and do our due diligence to select the right one. At MLS Finance we have a number of real estate agents we have partners with that not only align with our ethos but hopefully yours too. Feel free to send us a DM and we are more than happy to make the introductions.

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