Have you ever listened to an agent pitching their service to sell your home and wondered if they were ‘buying your listing’?
Unfortunately, in real estate, we see clients receive poor advice from their agent about the sale of their home, with one particular situation known as ‘buying the listing’. This can be for a number of reasons such as lack of experience, or commission focus instead of client focus. Either way, as a seller it is important to distinguish which agents are suitably qualified to partner with you for the sale of your home from those who are simply looking for a quick sale or who aren’t experienced in the market to achieve a positive outcome.
What does it mean?
Buying the listing is when an agent purposefully provides an appraisal range to a prospective seller above the market value in an attempt to win the sellers with price to list with that agent. Other agents may present a range within market value based on market data and trends however, the agent who buys the listing will use a higher price to secure the listing. Although hard to prove, buying a listing happens more than you would think and to unsuspecting vendors, this can be a costly error when appointing an agent under these pretences. Not only may it exhaust the marketing budget quickly, but it can also mean a drastic reduction in price over several months and a negative perception about the condition of the property by buyers looking in the market.
A reputable agent in the industry knows when you can generally push or pull a price back based on market sentiment and sale-ability of a home. They will also provide their prospective seller with solid market data so the client can form their own view on market sentiment and where their home sits in the market compared to recent sales of similar stock. Be cautious of an agent who over promises based on price without any real substantiation of process and market facts.
Questions to ask
Ask to see information around the following key points during the listing appraisal for similar homes in the immediate area:
- Average days on market /time on market
- % and $ change between initial list price, current price or sale price
- Sales per annum (suburb, dwelling type)
- Sales by price (suburb, dwelling type)
- Distinguish between the characteristics of each home and the similar features
- Recent sales within the last 6 months and within a 3km radius
If you are still in doubt or would like to get a second opinion, this is where getting in two or three agents can help.
Furthermore you may seek the advice of an independent valuer to provide a valuation on your home (this is a paid service by you as a prospective seller).
Using real, market data is important in evaluating your decision to sell your property, and using this information in conjunction with a visit to your accountant and or bank/broker will provide further insight into your options available.
Price, Presentation, Profile
Price, presentation and profile are critical in the success of any property marketing campaign. It’s no secret that homes which are displayed neatly, have an effective marketing campaign and that are priced well in the market will move within a reasonable time frame and will achieve a better price. There is no guess work here, the science is really quite simple. It just comes down to the seller receiving experienced, qualified advice and not relying on gut feel or crossing fingers to achieve a sale.
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