Don’t appoint a real estate agent before you read this

Five Questions You Must Ask When Choosing a Real Estate Agent.

Choosing the right agent to sell your home can be the difference between getting a great result, or no result at all. For most of us, it’s also the biggest deal we will ever be involved in. It pays to choose wisely.

Watch potential agents in action. Go to open homes, ask questions like a buyer and see how they perform. Do they know the home and local area? Did they make a follow up call to gauge your interest?

When you shortlist agents to provide a valuation and sales strategy, try to meet with at least one that offers a genuine alternative. If you plan on meeting an old fashioned agent, make sure you also meet with a flat-fee agent such as Purplebricks. Compare the different approaches and ask the right questions.

1: How do you justify your valuation of my home?

Setting the right pricing is one of the key reasons you are after an expert. Too low could cost you dearly, too high and you could wind up with no sale at all.

You need real evidence, not platitudes.

One of the oldest tricks in the real estate playbook is suggesting your home is worth more than it really is. For example, by claiming your home will sell for more than a $1million when the true value is closer to $900,000 the disreputable agent is “buying” your listing.

This can lead to frustration and heartbreak.

A couple of inspections later and the agent tells you everything potential buyers don’t like about your home, saying the buyers are pricing your home somewhere in the high $800’s.

It’s a well-worn strategy. When you are finally presented with an offer of say $920,000 you may actually feel relieved after a period of frustration.

And who is really losing out? For the agent, a sale at $1million (at say 2.2% commission) is $22,000. A sale at $920,000 is $20,240. So the agent is just $1,760 worse off. However, you are licking your wounds, feeling like you’ve taken an $80,000 hit because you were lied to in the first place.

Or worse, it may sell for even less. If the home sits on the market at an inflated price, potential buyers purchase elsewhere. Then, as the price reductions start, others feel there must be something wrong with it.

If you have a mortgage, think about all the additional interest payments you will make if the home sits unsold.

2: How should I prepare my home?

Ask every agent how to best prepare and present your home. They should know the most likely type of buyer. Ask them who the home suits and why. They should give tips on how to de clutter and which areas may need an update. When your budget is limited they should help you prioritize work to have the greatest impact. If they can’t provide help with any of the above, look for another agent.

3: How will you market my property and what will it cost?

Old-fashioned agents charge different rates of commission in different parts of Australia. You will also be asked to pay for things such as photography, copywriting, a signboard, floor plan and online advertising. Some will even suggest expensive newspaper advertising.

Given a combined 7.7 million Australians visit Realestate.com or Domain every month, do you really need the expense of local press? In the majority of cases great photographs online and a well-priced property will do the trick.

One advantage of Purplebricks, beyond the fair fixed fee, is their online portal. You receive a licensed local agent who handles the marketing, open houses and negotiations or auction but the portal (mypurplebricks) provides complete transparency.

You don’t rely on what an agent tells you. Instead you see how many people have inspected your home, you see offers being made and even what prospective buyers are saying. It’s a game changer.

4: Who will handle the open houses and negotiations?

Make sure you are meeting with a licensed real estate agent but also be very clear about who will actually meet potential buyers and negotiate. In some cases the licensed agent hands the home over to a junior sales assistant, so potentially someone who isn’t even licensed hosts the open homes and negotiates. If a sales assistant is handling your home, look for another agent.

5: How can you justify your costs?

Find out what sort of negotiator you are dealing with. If one of your potential agents is an old-fashioned commission collector, say you won’t work with them unless they lower their commission. If they can’t justify their price and agree to a lower fee, the alarm bells should ring.

After all, if they can’t sell themselves how will they sell your home? Just like dropping their commission, how quickly will they try to drop the price of your home to secure a sale and move on?

Finally, make sure you ask ‘why?’

It’s one of the most powerful questions anyone can ask. Your potential agent should be able to rationally justify anything they suggest, from pricing, to advertising and preparing your home for sale. And remember the more research you do, the more likely you will be able to tell if you’re speaking with a professional or a spruiker.

For more information: Purplebricks