No sale no fee?

[pete1000]

Just a quick query, have only been in Aus 18 months, have 3 investment properties, looking to sell one to release equity. Do REAs over here do no sale no fee i.e if it doesn't sell after a couple of months and it is taken off the market there is no charge for advertising etc. If they don't, what is the best deal I can negotiate?

Cheers

 

[vh2000]

Hi Pete,

Some agents in Sydney told me that I had to pay for advertising either sale or no sale. Their fees are negotiable.

Regards

Huey

 

[pete1000]

Thanks for that, guess everything is negotiable nowadays, feel it adds a bit of incentive to get it sold if the fee depends on it!

 

[tigerGT]

Hi Pete,

I really suggest you insist that you dont want to pay anything if it doesnt sell. The realestate agents would do pretty much anything to get your business these days.. I have dealt with 3 agents and have never had to pay anything when the property didnt sell. Infact one time when the agent recieved the holding deposit and the sale didnt go ahead he gave me all the holding deposit so I actually made money there.

Dont pay anything... No sell, no pay

Your paying for him to sell your house not to advertise it... They will try tell you it costs this much and that much but they get massive discounts for advertising and its really minimal...

So my advice to you is to hold your ground.....

Make sure you negotiate the sale fee too.

Yesterday I got it down from 3.3% plus GST down to 2.2% including GST. They will always throw a higher figure at you....

Good luck and welcome to Australia

 

[pete1000]

Thanks George,
I didn't see why it would be any different to overseas but it is good to hear it from someone on this forum - knowledge is power and it is a lot easier to bargain if you know it is common practice and has been done before.
Cheers
Pete

 

[House_Keeper]

No sale no fee should be the norm really. Why would you pay somebody for zero result? I have negiotated with some agents a no sale no fee contract. There are some agencies, like jenman, who work on no sale no fee basis.

The problem with advertising is that you don't know if it is spent effectively. When you look at some of the advertising out there, it seems to promote the agency or the salesperson more than the house for sale! At least, on a no sale no fee basis, you are sure that money spent on advertising is spent wisely.

Cheers,

 

[Kevin Hockey]

Do you guys mind if I ask what method you believe this agent will produce to ensure the right buyer will know your property is for sale?

Kev

 

[tigerGT]

As long as he/she advertise in the correct mediums im sure the propert investor will find the property. Most properties sell themselves. The agent just convinces the buyer that he should buy and points out all the good points.

One agent I knew, had a no sale no fee approach but he only listed properties at "justlisted.com." I was not happy with this so I saw another agent who listed it on 4 different sites and still didnt charge me a dime.

Some agents will list in justlisted.com.au as its free to list.

So to answer your question, the method most agents use is careful targeted advertisedment in conjunction with placing house on internet sales pages and then workign with buyers to achieve highest possible result for the seller and for himself.

Cheers

 

[qaz]

I'd rather have the agent working with me rather than against me. Some agents will screw you around, but they are far more likely to do so if your screwing around with them.

 

[Kennethkohsg]

Hi Pete,

I really suggest you insist that you dont want to pay anything if it doesnt sell. The realestate agents would do pretty much anything to get your business these days.. I have dealt with 3 agents and have never had to pay anything when the property didnt sell. Infact one time when the agent recieved the holding deposit and the sale didnt go ahead he gave me all the holding deposit so I actually made money there.

Dont pay anything... No sell, no pay

Your paying for him to sell your house not to advertise it... They will try tell you it costs this much and that much but they get massive discounts for advertising and its really minimal...

So my advice to you is to hold your ground.....

Make sure you negotiate the sale fee too.

Yesterday I got it down from 3.3% plus GST down to 2.2% including GST. They will always throw a higher figure at you....

Good luck and welcome to Australia

+++++++++++++++++++++++++++++++++++++++++++++++++
Dear GeorgeSA,

I am happy to note that you are well kept informed and learning fast in this area and are now constructively share your own experiences openly.


Dear Pete,

1. Have you have out checked out on the Jenman-approved RE agents at http:www.jenman.com.au .

2. Perhaps , you may want to consider dealing only with one of these Jenman-approved RE agents, to achieve this "No sell, no pay" tagline, as suggested by GeorgeSA.

3. for your kind considerations, please.

4. Thank you.

God Bless,
Kenneth KOH

 

[pete1000]

I'd rather have the agent working with me rather than against me. Some agents will screw you around, but they are far more likely to do so if your screwing around with them.

Hi Qaz,
I see your point, but I am not trying to be cheap or difficult or mess anyone around, I am happy to pay for good service and develop relationships with real estate professionals. However, I have experienced property managers quoting inflated rent returns to secure the business, having no interest in the property for a month with lots of excuses about the current market being responsible. On getting an independent rental valuation, and offering the business to the first manager that let it, funnily enough a tenant was found the next day.
Now all this comes down to me learning as I go along and getting a number of rental evaluations before engaging one particular agent, but I feel this would all be avoided in the selling process as not quoting a realistic price would not lead to a sale which would not lead to a fee.
Although a large amount of research is my responsibility, I do not think it is unreasonable to expect an accurate evaluation helping a quick sale, rather than an inflated value to secure the business and expecting me to pay for months of advertising with no real prospect of success.
I can hear a lot of people on this forum telling me I can avoid all this with a good amount of research and buyer/seller beware, but I don't think when dealing with a real estate professional I should be constantly worried about being taken for a ride.
On that note, thanks Kenneth for the link, I will look into it and now get off my soap box!
Cheers all
Pete

 

[willair]

I can hear a lot of people on this forum telling me I can avoid all this with a good amount of research and buyer/seller beware, but I don't think when dealing with a real estate professional I should be constantly worried about being taken for a ride.

Pete,
focus on the property,not the agent,only the property and numbers.
willair.

 

[Kevin Hockey]

As long as he/she advertise in the correct mediums im sure the propert investor will find the property. Most properties sell themselves. The agent just convinces the buyer that he should buy and points out all the good points.

One agent I knew, had a no sale no fee approach but he only listed properties at "justlisted.com." I was not happy with this so I saw another agent who listed it on 4 different sites and still didnt charge me a dime.

Some agents will list in justlisted.com.au as its free to list.

So to answer your question, the method most agents use is careful targeted advertisedment in conjunction with placing house on internet sales pages and then workign with buyers to achieve highest possible result for the seller and for himself.

Cheers

If you list on a no sale no fee basis this is about what you will get in most circumstances and for a very good reason. We all know how much the market has now turned back to a buyers market, many listings go through a couple of agents before selling. If an agency spent $500, $1000 or more on all the listings they have without any owner input they WILL go broke. Therefore, if you took 2 properties, one with advertising funded by the agency and the other funded by the vendor, which one do you believe will be more likely, at the very least, to be adequately exposed to the market.

Every property needs more than an agencies database and website listing/s to be considered "adequately exposed". Ultimately the choice is yours, I just figure the more people that know the greater chance of a buyer. When I sold my agency recently I made sure the business was marketed everywhere I could. I didn't want to risk missing a buyer who might pay me more. I now know I got the highest price I could because everyone looking to purchase an agency knew about the sale.

And sure, there is no guarantee of a sale from it, but I can guarantee you will receive a lot more enquiry. One of the most dissapointing aspects of selling RE is when a vendor doesn't contribute to marketing the property and then ends up receiving incorrect feedback re the property and then makes judgements based on that feedback.

Good luck.

Kev

 

[Kennethkohsg]

If you list on a no sale no fee basis this is about what you will get in most circumstances and for a very good reason. We all know how much the market has now turned back to a buyers market, many listings go through a couple of agents before selling. If an agency spent $500, $1000 or more on all the listings they have without any owner input they WILL go broke. Therefore, if you took 2 properties, one with advertising funded by the agency and the other funded by the vendor, which one do you believe will be more likely, at the very least, to be adequately exposed to the market.

Every property needs more than an agencies database and website listing/s to be considered "adequately exposed". Ultimately the choice is yours, I just figure the more people that know the greater chance of a buyer. When I sold my agency recently I made sure the business was marketed everywhere I could. I didn't want to risk missing a buyer who might pay me more. I now know I got the highest price I could because everyone looking to purchase an agency knew about the sale.

And sure, there is no guarantee of a sale from it, but I can guarantee you will receive a lot more enquiry. One of the most dissapointing aspects of selling RE is when a vendor doesn't contribute to marketing the property and then ends up receiving incorrect feedback re the property and then makes judgements based on that feedback.

Good luck.

Kev

*********************************************
Dear Kevin,

1. Bottomline, most vendors are concerned with achieving an effective house sale as its desired/intended outcome. It is for this service that they will always be prepared to pay for the price of doing a house sale through an Re agency.

2. More inquiries (about the property) does not effectively tranlsate into an effective house sale which is what all vendors want. This is not exactly what the vendors want from the RE agent service.

3. So how can vendors be re-assured that paying for the RE agents' marketing/advertising fees are worthwhile for them when there is merely an increase in inquiries without any achieving any concrete buyer's offers for the vendor's property being advertsied for sale?

4. Are the vendors actually paying to advertise for their own properties to the potnetial buyers effectively through the Re agency/agents or is he/she merely "helping to subsidise" the advertising of the RE agency/Agent's public image?... not to mention the fact that many RE agencies are known to be receiving hugh cash rebates for their newspapers advertisements, which were not been duly disclosed to the vendors in an open manner.

5. How are the vendors' interests properly safeguarded by the RE agencies in such cases?

6. Looking to your feedback and learning from you and the other members with RE agents background, please.

7. Thank you.

regards,
Kenneth KOH

 

[Kevin Hockey]

Hi Kenneth,

The advertising is not the agents advertising (or expense), it is the vendors house. My doctor certainly doesn't pay for my medicine and my mechanic charges me for parts. Advertising is no different. I have no guarantee the medicine will work every time or that the parts are genuine or going to work either.

1. Correct, everyone only wins when the property is sold.

2. True, however a RE agency will go broke if they fund it, as many are now finding. This leaves the owner to choose, fund the appropriate marketing themselves or allow the agency to do what little they will. If you are happy with a window card which produces less than 5% of buyer enquiry and a website listing or 2 plus maybe an insufficient line or 2 in a magazine which doesn't describe any features of your home then that's the choice. Occassionally it works however how do you know there wasn't another buyer out there willing to pay more, unless you have reached them.

3. As I said earlier, there is no assurance. It depends on many factors, most importantly if the price is correct. Over 90% of owners believe their property to be worth more than a buyer will pay, I do, you do, its a natural thing for us to do because we have an emotional attachment. Its just a fact of life.

4. This is just a couple of lines used by the great RE god in trying to denegrate opposition. Its working on the theory of politics where if you throw enough mud some has to stick. I have NEVER seen an agency receive a "kickback" ever. Most agencies are with a network and receive a reduced rate based on volume of marketing used with that source, which is passed on to owners. Independent agencies find it hard to compete with this.

As for paying for an agents logo etc, this is just hogwash. I have seen occasional ads where the logo is a little oversized but this is rare. If you are concerned by it then don't list with that agency. You will find plenty that are propertionate in size with the ad. Do your research.

6&7. Your welcome.

I no longer own an agency anywhere, so have no self interest in any way. I have bought one-third of Go Gecko ( www.gogecko.com.au ) but have no interest in any individual office. This is my disclaimer

Kev

 

[duncan_m]

The advertising is not the agents advertising (or expense), it is the vendors house. My doctor certainly doesn't pay for my medicine and my mechanic charges me for parts.

Hey Kev,

Welcome back!

Interesting analogy and oh so close to the truth.

Dr's get kickbacks from drug companies and mechanics apply exorbitant markups to parts (a colleague recently paid $75 for 5L of Castrol GTX from a large Holden Dealer in Adelaide).

It's rumoured that Real Estate Agents double dip however.. they get Kickbacks AND apply exorbitant markups to advertising? I know you say you've not seen it but I keep hearing Jenman and other commentators say it does happen..

 

[agent 86]

Kevin,

Good to see you posting again.

Now, if only Sultan of Swing ......

A86

 

[Kevin Hockey]

Hello Dunc & A86,

Thank you for your welcome message, it's nice to be missed

I don't doubt what Mr J espouses has happened, I just don't accept it to be the norm, it certainly isn't in Queensland, and this is what he wants us to believe.

I also don't consider whether the doctors get kickbacks or not as relevant, it is from the consumer perspective that we are discussing the point, I think. Ultimately the question is, is it better to list a property and leave it in the hands of the agent as sole responsibility for advertising costs or should the owner contribute. Which scenario is going to be most likely to achieve effective marketing of a property. How far will any agency dip their fingers into their own pockets to market a listing for sale.

Kev