advertising campaign for selling

[shuggy]

Hi everyone,

I have decided to sell a property in Brunswick and have just received the advertising schedule from the agent.

They have 2 prices, the 'optimal schedule' at $5,689.70 and the 'minimal schedule' at $5,389.70.

The $300 discount is because the 'large colour display' ad costs $1,170 and $870 with a 'standard colour display' in the Brunswick Moreland Leader (local rag).

I will be choosing the cheaper campaign and thought i could also save $785 by not advertising in "Home Preview Magazine". Do people think they get much exposure or should i drop them from the list?

One more question, do people think this is a good idea:

.... list it for sale at a high amount (the agent mentioned $599k) through the real estate agent's network several weeks prior to any media advertising so that i can test the market and provide prospective purchasers the opportunity to submit an offer prior to auction? One appraisal was $440-470k and another $520-$570k.

Do people think this is a bad idea because it will 'give away' our reserve if we go to auction?

Thank you,

shuggy

YOUR MINIMAL ADVERTISING SCHEDULE
XXXXXX STREET, BRUNSWICK
The Age – Domain Properties For Sale $2,055.20
Week 1 1 Module Display Ad (45 x 63) $653.40
Week 2 1 Module Display Ad (45 x 63) $653.40
Week 3 1 Module Display Ad (45 x 63) $653.40
Week 4 Auction Notice $95.00
Home Preview Magazine $785.00
Week 1 Full page colour display $245.00
Week 2 Full page colour display $245.00
Week 3 Full page colour display $245.00
Week 4 Auction column notice $50.00
Brunswick Moreland Leader $870.00
Week 1 Standard Colour Display $290.00
Week 2 Standard Colour Display $290.00
Week 3 Standard Colour Display $290.00
The Age – Open for inspection $77.00
Week 1 1 line - Open for inspection $16.50
Week 2 1 line - Open for inspection $16.50
Week 3 1 line - Open for inspection $16.50
Week 4 Auction Lisint Domain Express $27.50
Artwork $183.00
Artwork & production $95.00
Floorplan for back of brochure $88.00
Boards $451.00
8 x 4 Auction Photo Board $335.50
Light over board $60.50
Pointer Boards x 2 $55.00
Brochures $251.00
300 quality colour brochures
Internet – listing on 4 sites $350.00
nelsonalexander.com.au
realestateview.com.au
realestate.com.au
domain.com.au
Copywriting $120.00
Site inspection, copy & concept
Photography $159.50
Internal & External Photography
Photo Posters $33.00
Window photograph with banner
Direct Mail $55.00
Neighbourhood distribution & production
Estimated Cost: $5,389.70
Prices current as at 1st August 07

The PDF attachment is property sale prices in Brunswick from August 2007 to December 2007.

 

[BenG]

I'm not entirely sure what you mean by giving away your reserve but I would say that a higher price could just scare away real buyers who think it is out of their price range. I think getting price right at the start is very important as most people when looking to buy know what they want and can afford and anything out of their guidlines will just not be looked at.

Also I would consider spending more on online advertising and dropping some of other things off the marketing schedule. For example if it is good looking property than you could look at having it fetured on the Homepage of Domain.com.au in the You Wish section. I know from being an real estate agent previously that this work very well

 

[shuggy]

I'm not entirely sure what you mean by giving away your reserve but I would say that a higher price could just scare away real buyers who think it is out of their price range. I think getting price right at the start is very important as most people when looking to buy know what they want and can afford and anything out of their guidlines will just not be looked at.

Also I would consider spending more on online advertising and dropping some of other things off the marketing schedule. For example if it is good looking property than you could look at having it fetured on the Homepage of Domain.com.au in the You Wish section. I know from being an real estate agent previously that this work very well

Thanks for your feedback Ben. What things would you suggest i drop from the marketing schedule so that i can spend more on internet advertising?

Yes i think you're right that putting a big price on it may scare away some viewers.

I just spoke to the agent and he recommended a strategy called 'forthcoming auction' which costs $550 in advertising. This is a board out the front and internet advertising that doesn't disclose auction date or price. When people enquire about price range, he'll tell them between $520k - $570k.

He said run it for 3 weeks and have open for inspections on 3 consecutive Saturdays (Jan 19th, Jan 26th, Feb 2nd). If no offers, proceed with 4 week campaign starting on Feb 9th, leading to auction day on March 1st.

He says this way there will only be 1 interest rate rise, the one on Feb 1st and we'll also get in before the Grand Prix and Easter. There could possibly be another rate rise on March 8th or 9th or whenever the RBA next meets and my auction will have gone by then.

 

[shuggy]

I will be choosing the cheaper campaign and thought i could also save $785 by not advertising in "Home Preview Magazine". Do people think they get much exposure or should i drop them from the list?

The agent tells me this is the in-house glossy magazine that is published weekly with about 100 properties in it. It's distributed through their network and he tells me it's the biggest in that part of Melbourne... i'm not sure if i should dump it and spend more on internet advertising? I believe most people locate properties this way nowadays?

 

[BayView]

I was an agent for a wee time.

I don't believe you should spend more than about $150 on ads for a property, unless it is a multi-million dollar one of a kind mansion.

If you're having an auction (only worthwhile in a hot market and a scarce property design) then a few basic ads for the upcoming auctions, and a few open for inspections so people can see the place.

Ads are a total waste of money, and another money-making angle for the agents. They get paid kick-backs; regardless of what they tell you. Why should you fund ads that highlight their business?

The buyers are already out there; looking in all the agent's windows, trawling the streets with the agent's listing sheet, looking at the signs in the front yards, on the internet and reading the local and national papers.

I sold one of our properties with just a corflite hand made sign with stick-on letters attached to the front fence a few years ago. I got about 20 enquiries from buyers, and about 20 from other agents asking me for the listing, telling me how good a job they will do .

Total cost: corflite - $3
stick on letters - $5

Seriously, all you need is this:

1. sign on front fence - paid for by agency (make sure it is basic with very minimal agentcy stuff -just a name and phone number for them.
2. flyers in agents office and for the opens - paid for by the agency again. Basic, with minimal agency info. If you have to pay anything; all they're gunna do is take a few digital photos on their own camera, set up a flyer on their computer and make a hundred copies using some paper from OfficeWorks. Sling 'em $5 bucks for the paper if you're feeling generous.
3. internet ad - paid for by agency (and other Vendors)- same as above.
4. local paper ads - $50-75 for a few weeks if you must. Again; don't let the agency monopolise it, keep it small.
5. national paper ad - $100 for a few weeks, keep it small and basic.

 

[FinFreedom]

Agree with LA.Aussie. Ads in local papers are a waste of money, and another money-making angle for the agents (my cousin in Melbourne is an agent).

I'd go with a few small adds in The Domain and the net.

 

[twobobsworth]

I don't believe you should spend more than about $150 on ads for a property, unless it is a multi-million dollar one of a kind mansion.

But what about the agents profile? Surely we need a giant billboard with their logo all over it, and mabye a picture of a happy agent, happy because he doesn't have to spend a cent to promote his business!

 

[NedKelly]

Why isn't the agent paying for the advertising? I presume he has an exclusive agency.

If the agency was any good they would have lists of people ready to buy.

For $5,000 you might as well sell it yourself. $5,000 gets a lot of advertising.

 

[NedKelly]

Give us a laugh, does the agents name start with an R?

 

[shuggy]

I don't believe you should spend more than about $150 on ads for a property, unless it is a multi-million dollar one of a kind mansion.

Seriously, all you need is this:

1. sign on front fence - paid for by agency (make sure it is basic with very minimal agentcy stuff -just a name and phone number for them.
2. flyers in agents office and for the opens - paid for by the agency again. Basic, with minimal agency info. If you have to pay anything; all they're gunna do is take a few digital photos on their own camera, set up a flyer on their computer and make a hundred copies using some paper from OfficeWorks. Sling 'em $5 bucks for the paper if you're feeling generous.
3. internet ad - paid for by agency (and other Vendors)- same as above.
4. local paper ads - $50-75 for a few weeks if you must. Again; don't let the agency monopolise it, keep it small.
5. national paper ad - $100 for a few weeks, keep it small and basic.

Thanks LA Aussie! I do agree with your thoughts that the property sells itself and it's just a matter letting the public know about it.

Yeah $5k is a big hit for advertising (about $3.5k for print) but they argue its all about exposure and letting everyone know that its for sale.

Apparently most stock is sold from internet enquiries these days so maybe i could save $3.5k by cancelling the newspaper & magazine advertising.


But LAA, this is Melbourne and good luck finding an agent who will actually pay for the advertising! The vendor gets stuck with this plus the standard 2% sales commission.

The agent in Brunswick, Melbourne (NedK, it's a guy at NA) said we could negotiate an incentive structure... (i think) he suggested 1.5% up to 550k, then 10% of anything over this. They have appraised it at 520-570k.




I posted this spreadsheet on another thread (with incorrect formulas ) but its probably more relevant here for anyone interested. It shows the difference between paying:

A) 2% flat commission,
B) 1.5% commission up to 550k, then 10% commission of anything over 550k.


I've based the selling range from 500k to 590k but you can enter your own figures and use the same formulas.

I think my figures are correct. Please advise if anything needs editing.

You'll notice i've also tried to work out my net balance after paying CGT but i'm not sure if using a figure of 28% for tax is ok.

I think option B) looks the best as i'll pay less commission than a 2% flat fee unless it sells for over 590k, this is commission of $11,800 vs $12,250.

 

[BayView]

But LAA, this is Melbourne and good luck finding an agent who will actually pay for the advertising! The vendor gets stuck with this plus the standard 2% sales commission.

That's only your perception. As an ex-agent (god; I can't believe I admit to that) I am telling you the reality.

As I said before; all the stuff you should do is virtually free, and anything that isn't (the newspaper ads) put it on the agent to pay. They will.

You don't ask; you don't get. They WANT and NEED your business.

And, as everyone seems to be saying these days; Melbourne is a hot market, so there are PLENTY of punters out there already.

The spreadsheet you put together; delete advertising. Change your perception.

Here's a suggestion; forget the auction campaign (another cost saving) and sign up one agent for 30 days Exclusive Authority to sell (the agent will hate that length of time, but stiff) with the ad program that I set out before.

Make sure the selling price is REALISTIC. Unless you property is really unique, it will be the same value as the others locally. Check the propertie's value against other similar properties for sale/sold in the immediate area. All the buyers already know what the values are. Don't assume they won't.

It'll sell in a week; probably less if the market is hot as they say.

If it doesn't sell, go with another agent and give them 45 days to sell it and drop the price a fraction. Same procedure as before. Keep an eye on the local values.

 

[Dis]

The agent tells me this is the in-house glossy magazine that is published weekly with about 100 properties in it. It's distributed through their network and he tells me it's the biggest in that part of Melbourne... i'm not sure if i should dump it and spend more on internet advertising? I believe most people locate properties this way nowadays?

Those glossy magazines in particular are the biggest waste of time. They have properties from all the agents in a franchise so only 1 or 2 from teh suburb people are interested in.

The most useful things I found as a buyer was
a) Internet listing (Domain and RE.com.au - I only looked ar RE,com.au but some people may only look at Domain)
b) Window listing (some agents drive you around on a "run" starting at the office)
c) Open inspections on weekends. The closer to mid day the better (sometimes I can only devote an afternoon or morning but not both).
d) A listing agent who is prepared to show the property on week days rather than tell buyers to "just attend the open". (It was much easier as a buyer to line up 5 properties and see them in 2 hrs than waste a whole day on opens at odd times.

The only thing that costs you is the internet listing and that is cheap.

 

[steveadl]

I agree with others, give the internet advertising a go - if you don't get the sort of response/offers you're after, then you can start analyzing the other marketing available.

With my sale late last year, from memory I paid $100 for the sign out the front, and $50 for the internet ad. Sold on the 3rd day for above what I was expecting.

 

[NedKelly]

You can get extra advertising exposure for free by listing your property on these sites as well:-

www.owner.com.au
www.yourestate.com.au
www.yousell.com.au
www.smartvendor.com.au
www.listnow.com.au
www.anreps.com.au
www.ozcastles.com.au
www.ppl4sale.com

All FREE, just take a picture witha digital camera and write some nice words.

 

[jingo]

Hi Shuggy,

Perhaps interested buyers here should just send you a pm, and you can sell it privately!!

Brunswick is 'hot property' at the moment - especially if it is located between Sydney Road and Lygon Street!

I also believe that a sign on the front yard would probably attract some interest as well! How about some pamphlets in some of the cafes and restaurants on Sydney Rd or Lygon Street??

I went to inspect a unit the other day in Edward Street. There would have been over 100 people there! It sold before auction for over $400,000!!

Regards Jason.

 

[Xenia]

Although we are focused on property management we do a few sales for our landlords (about 2 per month). Because we don't depend on sales for income we are not dedicated to increasing our profiles to bring sales in. Therefore what we do sell we look at what works for the client. Here's what we do:

Sign, cost is around $250 (here we have our logo as it does not cost the client any more to do so)

Classified ads in the paper $8 per line and we have never spend more than $200 to sell a house. No profile for agency just the description of the house.

Internet advertising: Cost $100.

Display ads do not work any better, we have trialed display ads and cheap classified ads side by side and the enquires were exactly the same.

Most enquires come from the internet and classified ads link the internet site for people to look at pictures. The sign helps to identify the property.

Our results is that properties are sold usually at the first open inspection and at prices exceeding the vendors expectations at a minimal advertising cost.

Again, we are not focused on increasing our profile as we are in the business of property management mainly but we do know what works for the client even if it is not the best thing for the agency.

I caution you against spending $5000 plus that is just absurd. all you need is one buyer and A combination of internet listings and small classified ads work. Try them!

 

[shuggy]

Make sure the selling price is REALISTIC. Unless you property is really unique, it will be the same value as the others locally. Check the propertie's value against other similar properties for sale/sold in the immediate area. All the buyers already know what the values are. Don't assume they won't.

It'll sell in a week; probably less if the market is hot as they say.

If it doesn't sell, go with another agent and give them 45 days to sell it and drop the price a fraction. Same procedure as before. Keep an eye on the local values.

Great advice, thanks LAA! It sounds like you would prefer to sell by private treaty and not go to auction (which has much higher advertising costs, $5000 vs $550). I guess agents make more commission from going to auction but remember this is also Melbourne which loves selling at auction.

Jenman agents say you get a better result with private treaty and that auctions only give you the best price on the day. This agent is NOT Jenman and recommends an auction where they have appraised it at 520-570k.

But the trick is knowing what price to put on it without selling it too cheaply, and sounding ridiculously over-priced. I thought if i list it for 599k, maybe i'll get a few nibbles and some offers, hopefully around the 560+ mark.

Or else i just list it for sale with an agent and only do internet and in-house advertising. If someone enquires, the agent replies with figure of 599k or nearest offer; or he says we are looking at offers over 550k +.

Thanks Dis, Steve and NedK for your input. I'm now convinced to not spend $5k on advertising and get rid of the newspaper ads, it sounds like internet advertising is the way to go.

 

[shuggy]

I agree with others, give the internet advertising a go - if you don't get the sort of response/offers you're after, then you can start analyzing the other marketing available.

With my sale late last year, from memory I paid $100 for the sign out the front, and $50 for the internet ad. Sold on the 3rd day for above what I was expecting.

Steve, did you advertise your property for sale at $x or did you ask for offers over a certain amount? I'm just wondering if you gave people a price range or said it's, say, $500k or nearest offer? Thanks.

 

[shuggy]

Hi Shuggy,

Perhaps interested buyers here should just send you a pm, and you can sell it privately!!

Brunswick is 'hot property' at the moment - especially if it is located between Sydney Road and Lygon Street!

I also believe that a sign on the front yard would probably attract some interest as well! How about some pamphlets in some of the cafes and restaurants on Sydney Rd or Lygon Street??

I went to inspect a unit the other day in Edward Street. There would have been over 100 people there! It sold before auction for over $400,000!!

Regards Jason.

Haha, thanks for the idea to offer it through the forum but i'm not sure it's a good idea!

Your feedback on the suburb is good info for me and the Edward St result is encouraging.

For anyone interested in the details, it's in Connelly St between Sydney and Lygon St, closer to Sydney Rd, just off Stewart St. It's a 3BR, semi detached weatherboard, late Victorian style. It was last renovated in 1994 so has the apricot coloured walls, salmon pink doors and aqua teal trim. Typical Victorian layout with front door opening to passage that goes past 3 bedrooms, opening onto full width lounge and adjoining kitchen and dining are. Bathroom (shower over bath) with vanity, seperate toilet and laundry which opens onto small rear courtyard.

 

[shuggy]

Although we are focused on property management we do a few sales for our landlords (about 2 per month). Because we don't depend on sales for income we are not dedicated to increasing our profiles to bring sales in. Therefore what we do sell we look at what works for the client. Here's what we do:

Sign, cost is around $250 (here we have our logo as it does not cost the client any more to do so)

Classified ads in the paper $8 per line and we have never spend more than $200 to sell a house. No profile for agency just the description of the house.

Internet advertising: Cost $100.

Display ads do not work any better, we have trialed display ads and cheap classified ads side by side and the enquires were exactly the same.

Most enquires come from the internet and classified ads link the internet site for people to look at pictures. The sign helps to identify the property.

Our results is that properties are sold usually at the first open inspection and at prices exceeding the vendors expectations at a minimal advertising cost.

Again, we are not focused on increasing our profile as we are in the business of property management mainly but we do know what works for the client even if it is not the best thing for the agency.

I caution you against spending $5000 plus that is just absurd. all you need is one buyer and A combination of internet listings and small classified ads work. Try them!

Excellent info thanks Xenia! This is more confirmation for me not to go overboard with the advertising budget. When you do sell a property, do you put a fixed price or nearest offer, or do you put on a price range? I'm guessing you look at recent comparable sales to determine what figure to put on yours?

Thanks, shuggy.