Sales authority period

Hi all,

Hope you are all doing well and keeping safe! I am helping a friend sell her property as you do, and I have found her an REA she likes. She's now signing with them but I have noticed that they are putting in an exclusive sales authority for a 100 days with an ongoing authority period of a further 30 days. Its private sale and this is for a suburb that seems to currently be selling within 30 days. I would say this is excessive? Should that be shortend to 30-60 days tops and no ongoing authority period? I like the guy and all but just incase it doesnt work out..

Thanks for advising.

 

We always make the first contract for 42 days (6 weeks). That gives the agent time to prove they are worthy of an extension if necessary.

And we always make it a “sole” agency, never “exclusive”. The reason being that if events force a change of mind, we are not charged full sale commission.

 

100 days is a no. Agree 60 at max.

Your friend holds all the cards. If the agent doesn't like your terms, say adieus.

They will give in quicker than two shakes of a duck's tail.

Hopefully she's negotiated a competitive commission.

 

Hi @Marg4000 apologies, whats the difference as the contract itself stated exclusive and i didnt see any option for sole agency?

 

I did for her.. 1.8% + gst for upto her ideal price (750K) and 2% + gst for 30K or more than her best selling point

 

And no ongoing authority to sell right?

 

I also noticed that he didnt put the sale price below

But he put it here:

 

“Exclusive” means that the agent gets commission for any sale within the contract period. Or if you take the house off the market for any reason. Or if your friend decides to buy an hour after you sign the agency agreement.

All agents automatically ask for this without telling you the alternatives, as it it more advantageous for them.

“Sole” agency gives the agent the sole right to market and sell the property, I,e., no other agent can be appointed. But - they only get the commission if they find the buyer, or if the sale is a result of their advertising.

Ask the agent to explain the difference. If they won’t, find another agent.

 

Many thanks @Marg4000 I am getting them to change to Sole. Thank you!

 

The chances are higher than 99% that it won’t make a difference - they will find your buyer.

I just like to keep agents on their toes and let them think I know more than I do!!

 

Yes I dont want to annoy them but at the same time I did advocate for them over a few other based on their responsiveness and they know I made a case for their selection. So I think will be okay.

 

I have used similar pricing model in the past, however, you need to to be aware of the proceeds to the Seller just above and below the $780,000 price point. (ie, Proceeds= Selling Price - Commission).

You will find the Seller is better off by approx $735 if the property is sold at $779k rather than at the targeted $780k.

 

Lockdowns killing the selling mojo

 

Thank you for the thread.
The commission here in Bris seems quite high. The lowest rate offered so far is 2% plus GST (with 4+Mil property).
Has anyone in Bris been able to negotiate a lower rate, thanks ?

 

Up here the going rate for everyone is 2.5%

Best thing I could suggest in Brisbane, is that if you are selling a house worth 4mm and the agent is willing to charge only 2%, I'd go to a higher tier agent. They have the success to back it up and usually refuse to go lower than 2.5, typically charging 3.

 

Thank you for your comment.
The agents I have approached are named agents (with backup success I guess) and they all offered me a discount rate without me asking. May be I have not yet met a higher tier agent. Could you suggest one or two please. Ta..
.

 

Hey all, just a note, it sold. For 750K, the amount they were looking for in 4 days. 30 day settlement, no conditions.

I would have kept it there for longer and seen what i can achieve in a week or two, but they didnt want to, so we sold and moved on. Thanks for your help in deciding this!