Questions on selling a house in Sydney

Hi guys,

We are considering selling - however we will only sell if we're offered a very good price. How to discuss this with an agent? I mean if we will only accept x dollars (or above), and the agent specifies a probable price range which has its maximum at a lower value than x then what happens? If we only get offered less than x dollars then is the agent entitled to a commission even though the house didn't sell? (Is this covered somewhere in the fine print of the Exclusive Agency Agreement?). Should we tell the agent before we sign the EAA that we won't sell for less than x?

It seems that these EAAs in NSW usually state "The Principal hereby grants to the Agent exclusive selling rights..." for 3 months. Is 3 months too long in the current market?

Also the EAAs specify a "Continuing Agency Period" after that 3 months. Is this excessive?

 

1. You can have a much shorter exclusive selling rights period. You can negotiate that. Also the commission is negotiable.
2. If you don’t sell, there is no commission to be paid. You only have to pay for the marketing. You are free to tell them you won’t sell for less than x, but you may change your mind, if the agent pressures you as the campaign goes on. “Oh, there isn’t as much interest as we anticipated”…

What happened to your overseas buyer btw?

 

You can negotiate it all. You could put it on for exclusive selling rights for 30 days and then see how it goes/

 

What happened to your cant be beat off market offer?

 

Sale by auction is our Plan B - so I need to learn more about that procedure. (This is the one and only house we've ever bought in NSW, so I'm totally green)

and Plan A - the overseas buyer.
Two days ago we received a contract set set up by our lawyer, so yesterday my wife sent the overseas (still potential) buyer a copy plus the price we want etc, and we're waiting to hear back. (but he has been informed of the limited timeframe that we'll keep it off market).

Thanks re the no commission to be paid. I suppose it's hard on the agent if they put the work in and get no sale - but I guess that is balanced out by the huge $$ they receive when they do sell.

 

Still simmering.

 

"You are free to tell them you won’t sell for less than x" - I wonder if the agent would think this is likely to be a waste of their time? or to be less than diligent in trying to sell it?

 

It depends in the agent.
Off the top of my head here's some ways the agents might tackle this.

*They may tell you straight out that they think what you are asking is completely unobtainable (and give you comparables to demonstrate that) but still say they will do their best (they still want the listing as your home will still draw buyers they can add to their database)

*They may say to you that they agree its possible (and depending on the market, it may be that they can or can't get it and so then they tell you mid campaign that you have to drop your expectations if you want it sold in x days/weeks). Depends on the agent though.

*Note too, they may say they have buyers lined up and ready and looking for a property just like yours and they might suggest showing your home as a private "off market/pre-listing" property for a short period just to these ready buyers. You may save some marketing costs. This is actually quite a real possibility imo as loads of people are keen on buying in Chatswood.

*You may have an agent that will tell you that it's going to maybe take more time to get the price you want - but I think this is unlikely in your case as you have your specific goals and it's not a tactic that I think would work for you to be honest.

So, anyway, they will still want your listing as they'll get enquiries coming in and they get brand exposure. So even if they get no commission from you, they still get seen by buyers and in turn also sellers. Being visible is the main thing agents need from any listing.
Because only by being visible and active will they make sales. Would you choose to engage agent who has no listings?

Anyway, have a look at the other properties the agent has sold recently. Some agents are much better at obtaining a high price than others. The homes themselves play a huge part in the sales prices, so don't ignore that factor.

Oh and the agent may say you need to spend money tidying up the garden and other things (staging, skylights, paint job etc) to make it more saleable/appealing. Consider their advice, but note it may be a 20k+ investment if you were to do it all!

 

Thanks Gockie - lots of very useful things to know in your answer.

In the present hot market perhaps a newbie agent would put more effort into it than one of the big names? (They would value my listing more?)

 

The established agents do not want to tarnish their reputation, it's their career at stake. They generally employ an assistant/a more junior agent to help them with the basic things, but the main agent would tend to manage the negotiations. This is the most important part of it. Do you want someone untested doing the negotiations? The marketing and negotiation process could easily result in a 6 figure difference in sale price.

 

Good point. However looking around my area it is often the case that the big name agents are getting prices that are a bit underwhelming. What they are very good at is getting lots of listings and making lots of sales. Perhaps I'm just looking at too small a sample size to make such a pseudo-statistical conclusion?
Also a lot of wealthy Asian buyers in our area, so I suppose it would be advantageous to pick a negotiating agent who is a native Mandarin/Cantonese speaker? Having said that I see some of the big name Asian language speaking agents getting underwhelming prices too.(?)

 

Thanks Wylie. I can check out what the rules are.

 

I always go for the agent who gets good prices but is not a huge firm where all they care about is number of listings. I've found the agent who is very enthusiastic and works very hard for each listing and sale will rarely be the big firms. More often than not I've been happier with the agents trying to make their mark in the industry who are very hungry to prove themselves.

 

Yes I have the same impression - those guys have to work harder or they are unlikely to have a successful agent career.

 

The Question is do you do the Video and the Aerial or no?

 

I have done both and for me it depends on mainly 2 factors:

1. State of the market in general. In flat markets with not much buying pressure I don't see the money spent worth it or the video particularly effective.

2. Depends on type of house. If it's a cheapie 400k average property then probably not. If it's a more luxurious property in a higher price bracket than probably I will, especially if the interiors are new or has emotional flair.

 

Can you find any local agents that consistently get sales prices that you think are strong?

 

Consistently? No, not really. It seems most agents get some strong prices and some that they probably feel not too proud of. Depends partly on how many keen buyers turn up at an auction. But I still think some agents get stronger results on average.