Dealing with Real estate agents, Selling my OTP apartment

Hi everyone,

Happy new year!

I was hoping to hear your thoughts and wisdom/experience regarding with dealing with REAs and any potential refferals.

I purchased an OTP apartment at the 'wentworth point marinas' (Sydney) development and the property is due to be settled end of Jan

The property itself is a one bed+study, carspace w/lockup storage.

The original intent was to purchase this apartment and keep it as an IP for about 3years then on sell. But due to change of circumstance, life etc I'm now looking to offload the apartment to invest the funds elsewhere. So I've begun interviewing REA's. I figured I need to strike whilst the iron is hot so to speak, as the property is Brand new so would suit first home buyer or an investor looking to make the most of depreciation etc.

I spoken to about 4 all up so far and have had face to face meetings with 2.

Please bear in mind this is the first property I will be selling so dont really have much experience in dealing with REA's so any help/tips would be greatly appreciated as I'm very skeptical of how honest some REA's are.

This is the info so far from the REAs I’ve spoke with. All charge quite similar fees (2%2.2% + marketing) one was willing to incorporate marketing, but the ad would not be a first page listing *to me it is important to have the ad on the first page so I dont mind paying. What have you guys managed to negotiated the comms down to?

Exclusivity clause, all have this. I don’t like the idea of being locked into a deal with just one REA but I do understand there side of the argument. However, as the vendor I want the best possible price and for the property to be sold in an appropriate time slot.

Pricing, on REA suggested putting the property up as a Offers above. Or price guide. Another mentioned price bracket i.e 440-460 etc. One guy mentioned ‘open to offers’ which I turned down right away as IMO thats just a waste of time. What strategy have you guys have used in the past and what has been effective?

The reason why I’m sceptical with how REA’s operate is that whether the final sales figure is 10-20k more or less that does not really affect their overall comms. 10-20k in the price variance to the vendor is a fair bit but to the REA only translate to $200-$400. So I question how hard they will advocate for a higher price or just go for the easy sale. Even though the decision is ultimately mine to accept the price I just cannot help to think thats how things are done.

Pricing cont; There has been abit of a variance in the price between some REA’s on this matter too. I know some try to bait vendors into a deal by claiming they can sell the property for X price but the final figure maybe much less as oppose to being honest about things are saying ‘we should price at price Y’.

Would anyone be able to recommend a REA reputable for selling properties within the Olympic Park area?

Are there any specific questions I need to ask or anything else I should be considering with this selling process.

Cheers

Jt
 
Check out this attached file.

It is a new commission structure form I used that actually worked quite well. Get your solicitor to go over it but it virtually punishes the agent for over quoting and rewards them for getting the best price for your property.
 

Attachments

  • Clause 3vii _version 2_.pdf
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Thanks for that Georgie1, I was thinking of something along those lines. I'll bring the document along with me to the meetings with the REA's I have lined up this week.
 
I've got another question somersofters...

This is down to picking an REA. As mentioned above the apartment I'm selling is located at Wentworth Point, so naturally I have spoken to a couple of the agencies within that vicinity. Not sure if its appropriate to name them though??

But anyway, my questions is...Is it better to go with a smaller organisation such as the 'local' agencies who have embedded themselves into that particular market but have alot of the same stock, some of their older cheaper stock will be competing against my listing. Which makes me wonder if they would just offer buyers the cheaper option to claim their commission?

I also notice that these REA's have come in less with what they think the apartment is worth as oppose from one from just outside the area? I suppose the'r experience and knowledge of the area is valuable but I question how much they would be motivated to look after my interests in securing the highest price possible due to the amount of stock they have to push for similar commission.

I have also spoken to some REA around the strathfield and burwood area as they are not too far from WP and would not have as much stock of this type of property?

Just a thought...
 
I would consider that the smaller agency would probably have more 'buyers', and by that I mean if you were to list with them they would already be thinking that this unit would be perfect for Mr & Mrs Whatever.. The sales agents at my office regularly sell 1 & 2 bedrooms to investors who are passive, and when given a call about a new listing, will often buy.

Also, from my experience many many sales we make are to people that enquired about a different property - and after finding out what they want we were able to suggest another more suitable listing. So this agency with more unit listings is going to attract more unit buyers in that area. They may be looking at a larger price range, that your unit may fall into.

If the smaller agency is the area leader, then I would use them. I would not be concerned about agents pushing 'cheaper' properties - as many buyers don't just want the cheapest thing out there. It also depends how long their stock sits for. Ask them what their average number of days on the market is, and what their average selling price/listing price percentage is ie - avg sold in 35 days for 97.3% asking price.
 
Why dont you google vendors advocate and see what comes up. My understanding is they help you choose the agent and look after your interests.....
 
Why dont you google vendors advocate and see what comes up. My understanding is they help you choose the agent and look after your interests.....

Basically my understanding of a Vendors advocate is one agent overseeing another!!! -you should choose the agent you trust the most regardless of their location. Ask them for proof of the results they have achieved using their suggested sales method and ask them how they will achieve the best price for you. I do however agree that a local agent will have buyers they are currently working with...if someone was interested in a property in that location they will be more likely to go to or contact a local agency.

There are also real estate consultancy companies out there, all they do is refer you to a local agent and take 20% of the commission....be careful as this then provides a disincentive to the local agency to sell your property as their commission is lower.

Good luck with the sale.
 
Not knowing the area, I had a look at the Developers Site, and it shows that they have 1 + 1's starting from $393,000. So to me it would seem that you will have the balance of the Developers stock as your competition for a buyer. I think I noticed that Stage 2 has just been relealsed with prices from $399,000.

Have you considered how you will compete with those for a buyer? The agent that has the market highest share in the area, should be the one you are talking to, and hearing how they propose to market up against the balance of the developers stock.

Good luck with the sale.
 
Not knowing the area, I had a look at the Developers Site, and it shows that they have 1 + 1's starting from $393,000. So to me it would seem that you will have the balance of the Developers stock as your competition for a buyer. I think I noticed that Stage 2 has just been relealsed with prices from $399,000.

Have you considered how you will compete with those for a buyer? The agent that has the market highest share in the area, should be the one you are talking to, and hearing how they propose to market up against the balance of the developers stock.

Good luck with the sale.

Thanks for the advice so far guys.

Peter, I think those ones dont include parking but you make a valid point. I spoke to a REA today who has sold a similar apartment to mine a few days ago said it whent for $439k sight unseen. She mentioned might be able to push for more once they have access so people can actually see what they are buying :)
 
Thanks for the advice so far guys.

Peter, I think those ones dont include parking but you make a valid point. I spoke to a REA today who has sold a similar apartment to mine a few days ago said it whent for $439k sight unseen. She mentioned might be able to push for more once they have access so people can actually see what they are buying :)

That sounds like an agent to go with. Good luck.
 
Hi georgie1,

how does the section E formula work? Its confused the crap out of me

Base Com X final price + ((4 X ((final sale price /agent app pric) -100%)) X (base com X final sale price)


ok lets say base com is 2%
final sale price is 190 K
agent appraise price is 200K

we get:
2%X 190K + 4X ((190K/200K)-100%) X (2% X 190K)

which comes too:

3800 + (4X(0.95) - 100%) X 3800

3800 + (3.8 - 100%) x 3800

so how do you do 3.8 minus 100% ? unless you mean its -3.8%

Then that would make 3800 + neg 3.8% X 3800
3800 + neg 144
3800-144

= 3656

Geez that is confusing! :confused:


Why not make the formula a little easier to read:

having the minus in there makes certain that the agent knows they are being penalised..

(Base Com X Final sale) -

((4 X((Final sale price / appraised pric) /100)) X (base com X final sale price))


I dont think most agents would even be able to read the first formula with the -100%.. because I was struggling to understand what you meant. (I may have the maths wrong, so please correct if i have stuffed it up!).

Rowena
 
Hi georgie1,

how does the section E formula work? Its confused the crap out of me

Base Com X final price + ((4 X ((final sale price /agent app pric) -100%)) X (base com X final sale price)


ok lets say base com is 2%
final sale price is 190 K
agent appraise price is 200K

we get:
2%X 190K + 4X ((190K/200K)-100%) X (2% X 190K)

which comes too:

3800 + (4X(0.95) - 100%) X 3800

3800 + (3.8 - 100%) x 3800

so how do you do 3.8 minus 100% ? unless you mean its -3.8%

Then that would make 3800 + neg 3.8% X 3800
3800 + neg 144
3800-144

= 3656

Geez that is confusing! :confused:


Why not make the formula a little easier to read:

having the minus in there makes certain that the agent knows they are being penalised..

(Base Com X Final sale) -

((4 X((Final sale price / appraised pric) /100)) X (base com X final sale price))


I dont think most agents would even be able to read the first formula with the -100%.. because I was struggling to understand what you meant. (I may have the maths wrong, so please correct if i have stuffed it up!).

Rowena

Section E is if the property sells for MORE than the appraised price. You are using the wrong formula to calculate the penalty. Section F refers to the penalty. The form rewards agents who get a higher final sale price than they originally quoted but penalised if they get less. I ran the numbers and if the property sold for $210,000 when they quoted $200,000 they would get $4800 commission and not $4200 if working off 2% comms.
 
Hey guys,

Has anyone here had any experience with either;

-LJ Hooker strathfield
-Devine Real Estate Strathfield
-Warwick Williams Real Estate

Or are there any websites which has reviews on RE's?
 
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