Selling agent fees

@Perthguy from my real estate days, both are of the same house.

Which photo draws you in more?

Marketing is about visibility it is taking a product or service from unaware to aware through to action. If no one is aware of your property is for sale it wont sell... If you stood outside your house with a board saying house is for sale you might get a buyer. If you advertised for a month on all television stations a lot of people know about your house but it isn't targeted to your target market and would of over spent.

Marketing is not about getting more $$$ but rather having more people interested in your property, which in turns generates more demand thus sell faster and for more $$$. You might not be happy with the result but what if you spent $1,000 and got $20,000 less on the sell price, would that be a better result?

Marking you need to think of as a sales funnel with the following with 1 being at the top;

1.Attention (Awareness) – Attract prospect’s attention

•Photography
•Print (Paper)
•Internet
•Realestate.com.au
•Domain.com.au
•Realestateview.com.au
•REA website
•REA Database
•Property Update
•Network of buyers
•Window Displays
•Brochures
•For Sale Board
•Mail Drops

2.Interest – Raise interest by focusing on benefits of your property
•What type of people will your property appeal to?
•First Home Buyers
•Young families
•Tradie (workshop areas)
•Downsizers
•Home business
•Investor
•Renovators
•Developers

3.Desire – Consideration, want your property
Consideration Set
1.Individuals are aware of a lot of houses in any given price range.
2.However, not all houses are seriously considered
for purchase.
3.The consideration set is made up of the houses
that are taken seriously by the consumer in his
or her purchase decision.
4.The Consideration set is small – averages maybe
in the 3-5 region (this is the average a person will visit on the weekend).
5.Some purchasers may have consideration set of
size one, but they are rare.
6.Getting purchasers to take your home seriously
is harder than making them aware it exists.
7.Most house failures take place because while
awareness is achieved, desire is never attained.
8.Entering purchasers consideration sets requires a careful understanding of the marketplace. Throwing money on advertising will typically not solve this problem.

4.Action – Lead the customer towards taking action and/or purchasing your property

The more you put in at the top (1) the more it would lead to take action (4). You cannot skip a step or it wont work.

A common questions is why advertise on both Domain and Re.com? I prefer Domian's app over the RE.com but I prefer the notifications from RE.com, however most buyers will not use both services and likely not to use notifications. So if one provider had 25% market share of all online traffic and the other had 75% you could just advertise on the larger one but then your cutting out 1/4 of the potential online market, are you okay with this?

Upgrading the online package doesn't make a great deal of sense if there is only 5 houses up for sale however what if there is 400 places for sale then it is a necessity. However what if 100 of those properties have already paid to upgrade theirs and during your campaign another 100 come on board well yes you are 100 spots down however the alternative was you were place at 100 on day 1 (very low visibility) and if 50 houses sold before the next 100 houses got listed you are now at 150 (even worse than before).

 

I realise I haven't sold in some years, but do people really do all that still?! I've bought twice recently and only chose online what I'd be looking at in-person (or even sight unseen).
In Canberra, the only real game in town is allhomes.com.au.
Photography yes, big sign at property yes, brochure yes, internet yes (though note the difference depending where you're buying, eg. allhomes).

I certainly never even looked at the rest as a buyer.

I'd respectfully disagree - when looking, I go through every listing in the area(s) that match my criteria. I don't care one bit whether it's on the front page or not, whether it's marked as special, bigger font, etc. Location, style, # bedroom is enough to decide whether to go further, and I look through every single one of those that are relevant.

As a buyer it wouldn't impact me at all if all 400 upgraded to "special" or none of them did - for a start, there's *never, ever* going to be 400 properties of my specification for sale in an area I'm interested in. By the time you've got the location sorted - whether it's PPOR-specs (near school, work, park, etc) or IP-spec - and then the size, either of block or number of bedrooms, then combine all that with a price point that's even remotely possible, you've usually got rid of a huge percent of the possibles. I'd argue that's what most people do, not just savvy investors or savvy buyers. Those who don't do this soon do so after a few weekends of looking!

So I'd say the "upgrade the package" is mostly now just good for the agents and almost never for the vendor. It may have made sense years ago but certainly doesn't now (although I'll give that it could do so in a small, limited set of circumstances). The cr@ p response of "I can tell you from experience that it works", doesn't cut it from "trustworthy" real estate agents!

 

You are like myself when searching, however you have put plenty of assumptions that everyone uses the searching the same as us. I rarely use the best match (as it does the ranking system) but I do use 'most recent' and 'longest time on market' in my searches.

When I was younger I used to trawl through the searches not knowing these two searches and thought best matches met my criteria the best, how wrong I was! I am in the 30 y/o and have grown up on computers and it took me awhile to work this out. I am sure not everyone knows this and most people would just do normal searches. I am sure if you contact domain/re.com they would have statistics on how many people use best match search compared to another form.

I know that if my grandparents were looking they wouldn't know about this or how to filter their search besides the basics (suburb, rooms/baths).

Regarding online vs print, I am also a firm believer of online for its bang for buck. However if you were trying to attract a top price for a nice renovated property you might consider print to encourage buyers to see value in yours for slightly less than their preferred suburb.

Another strength of print is with the elderly, my grandmother doesn't have a computer so how would you advertise to her? She would be likely to ask her children to help her but she would also go to the REA and pick up the local magazine to see what houses are up for sale as not to be a huge burden to her child (also her taste might be different). So print is great for the elderly if they are part of your target market.

 

I pretty much agree @Big Will, but my selling demographics have never been to those older than me! I'd never target my advertising to the elderly because I'm not selling nursing home places .

Typically I'm been aiming at the 30-40 yo's, and I've yet to meet many that a) are looking for property, AND b) where the one that wears the pants isn't very computer-literate. If I ever have property to sell that does have a target demographic of the older-than-I-am, then I'd agree that the advertising should match the target: for example, make sure that there's a nice flat, safe spot with 3 phase power for the caravan for the downsizing grey nomads; and a garage with high roof entry for the 4wd tow vehicle .

 

@Big Will thanks for the detailed response. I am an active property investor particularly targeting the type of property I just sold. Based on my experience with sourcing these properties, I would rate my marketing campaign as poor. The property we sold has development potential and a keyword search on 'development' did not return my property in the search results on re.com.au. Throwing money at a professional copy writer in my case was a waste of money pure and simple. The copy did not sell the features of the property adequately. This is basic stuff. Marketing 101. I am posting this because I want other sellers to know that throwing dollars into a marketing campaign won't automatically translate into a good campaign. A good campaign takes knowledge and skills. Don't assume the people you are hiring will have these. Mine didn't. Next time I sell, I will not be using the agent's package and I will not let the agent be in control of the marketing campaign. I wasted a lot of money on this campaign and I am annoyed at myself for doing it. In this case you don't get what you pay for. Hire your own contractors and make sure they do their job properly before you pay them. In my case, I could have run a much better campaign for about half the cost.

 

Big Will and others, thanks for the detailed posts and thoughts. Much to consider.

 

How did you go with this?

 

Then you are not providing value.

Get lost? What does that mean? That Buyers are too stupid to concentrate to look through all the listings, so you have to compensate for that by trying to stand out by being at the top of the list? If that is so, there must be some really stupid and lazy buyers out there. If you want to pay to cater for those fools, fine go for it.

Talk is cheap & there is no way you could prove what you just said. In all the houses Ive sold with agents, they ALL sold within 60 days, and zero advertising $ were paid.

Yes, which doesnt really require an advertising budget. The internet and the 2 major RE sites DO make everything visible, despite what you would have us believe

Nope.

Nope.

again, you have no way of proving that. Perhaps this is a Syd/Melb inner city perception, but its not de rigeuer elsewhere, and certainly not mandatory to achieve good results.

Utter rubbish. Serious buyers will find it.

 

they are only a monopoly because the state based RE "institutes" are too lazy/inneffective to get off their butts and create a website for all their members to use. If they did they could dump the duopoly .

 

Pretty much!

I am careful about how I search, filter and sort listings when I am looking for a property. However, I have become aware that many buyers and renters do not look beyond the first page or 2 of listings! It's hard to believe that serious buyers would be this lazy or stupid (or both), but they are. They are also more likely to pay more for a property because they haven't done their research properly. If you can attract this type of buyer you have done well.

I spent a lot of money only attracting savvy buyers for my property, which is a shame because it meant that I got slightly less on the day.

In WA we have reiwa.com.au for property listings, which is my default search provider for listings in Perth. I only use re.com.au if I need to search for something very specific because reiwa don't have a keyword search. Other than that, I like reiwa better for searching, filtering, sorting and viewing listings.

 

I would prefer to cater to a fool as they will likely be more foolish than the buyers who are researching and will be more knowledgeable on what your property is actually worth as they are viewing more houses and spending more time researching.

 

Fools are timewasters...

Thats just it, they are not serious buyers. Whilst I see your point, if you are fishing for halfwit buyers, then likewise you could not be considered a serious seller, if you are biding time waiting for a fool to give you an above market price. Think about it.

 

Slowly. I decided that as the market is down I will wait. I have everything ready to go and can do so quickly when the conditions are right. It's nice to be able to wait out any downturn.

 

Do your own thing.

However IMHO the buyer who spends less time looking for property is not going to be as educated as the buyer who spends more time.

Also if you have 3 offers you have the power, if you have 1 offer that buyer has the power.