January isn’t typically a busy time for your property market, but if you’re considering putting your home up for sale in the spring it’s worth starting to have everything in order. With the huge majority of sellers still entrusting the sale of the property to a conventional estate agent, choosing the wrong one means that you could be stuck with them for weeks. Here are a few tips on the best way best to make the procedure as stress-free as possible — based on my years of working as a real estate agent.
Start selling before you start buying
Can you accept an offer from a purchaser whose own property isn’t on the market? By all means, get an idea about what you want to get, ensuring that your moving plans are workable, but before you begin making supplies, you really have to be sold subject to contract. Estate agents rarely recommend their customers take an offer from a buyer with an incomplete chain. A rare exception is where a homeowner with an extremely saleable property — maybe one in the catchment of a popular college — is selling to purchase in exactly the same area. In this case, the seller is able to sit tight and will likely find an estate agent quite keen to provide superior terms to obtain their property on their books.
Shortlist from the most active local agents
One customer admitted she’d picked our agency only because she liked the color scheme of our boards, however, you’ll most likely want to be somewhat more scientific. The best indicator of a successful estate agent is the way lots of their boards are up close to their workplace. But don’t be too impressed if they mostly read”For Sale” — those might be caused by anything from the broker overpricing peoples’ houses to a particular promotion offering cut-price or zero commission. The latter may operate, saving you money, but do read the small print. At the conclusion of the promotion, the commission may revert to double that of other estate agents’. Moreover, if an agent has just sold a property in your area, they’ve experienced more than one interested buyer. In that case, they are going to have a listing of those who lost out on this land and are ready to purchase yours — saving you weeks of viewings.
Decide how many agents you want to use
A sole agency agreement is when one estate agent is educated exclusively in the sale of a property for an agreed duration, generally eight to 12 weeks. During that term, the vendor shouldn’t change from or instruct extra agents — if they do, they might find themselves paying more than 1 commission. Even if a seller, signed up to a 10-week only agency, terminates the contract halfway through they might still be responsible if a property agent sells the property during what would have been the remaining five months of the initial sole agency.
In a multi-agency arrangement, there are no limitations on the number of brokers a seller can teach and no fixed term. The brokers market the property concurrently and the seller pays just the one which introduces a buyer who contracts to buy the property.
Both kinds of arrangements have their plus and minus points. The commission fee for the sole agency is less costly than multi-agency but if you instruct the incorrect estate agent you’ll be stuck together for the duration of the contract.
Using a multi-agency you are not tied to a single agent and you are able to pit those you select against one another. However, while this may keep them on their feet, it may keep them from being honest with you. Let us say your sole agent introduces a buyer who offers the full asking price. Your broker advises you against accepting the deal until the series comes together, which is sensible advice. Now, same situation, only this time three estate agents are vying for the commission. The information given to the seller may differ. The buyer might be presented as being in a stronger position than they really are, so the offer is accepted and the other brokers back off, buying time for the less than a truthful agent.
Instructing too many brokers may also give buyers the wrong impression. I once saw a novice developer give a home he had refurbished to eight different estate agents to advertise. All the brokers advertised the property with Rightmove which supposed the land came up eight times consecutively on the search results page. Did prospective buyers think the seller was desperate or excited? A flow of non-offers decided the latter be true.
Negotiate on asking price and fees
When land is scarce, competition between estate agencies can be ferocious. Supplying a prospective seller with an inflated appraisal of their residence has proved a trusted approach for agents to win business over their rivals.
As a seller, this may work for you in a rising market; at the beginning of the contract, the land may be overpriced but, by the end of the term when the market’s caught up, the cost becomes sensible and the property sells.
If the market stinks, you might be stuck, unsold, and having an agent who is now recommending a cost reduction. Invite at least three estate agents to evaluate your property. If one recommends a higher asking price than others, inquire why — does he have a unique buyer who will pay the higher cost?