Ray White is a complete waste of time

[boomtown]

I get a series of email alerts from a wide variety of REAs. But for some reason Ray White is the only one that never includes indicative prices on their alerts or on their newspaper ads.

As a result I now automatically delete any emails that I get from Ray White and I skip over their ads in the paper. I dont have time to wade through all that crap in the hope of finding a hidden gem.

Ill stick with other REAs where at least you can get a sense of whether the vendor is sensible and committed to selling before you go visit the property. Ill leave Ray White with the dreamers and 101 listings of "auction" which incidentally never sell in Brisbane with our current 17% clearance rate.

Good on you Ray White for doing both buyers a disservice by failing to signal price and for doing sellers a disservice by persuading them to spend 10k on going to auction when less than 2 out of 10 sell at auction currently and something like half don't even get a single bid. How much did you guys earn this month from failed auctions?

Piss poor all round.

 

[HiEquity]

Good on you Ray White for doing both buyers a disservice by failing to signal price and for doing sellers a disservice by persuading them to spend 10k on going to auction when less than 2 out of 10 sell at auction currently and something like half don't even get a single bid. How much did you guys earn this month from failed auctions?

Piss poor all round.

Interesting. Just went to a Ray White auction last night. 6 lots were put up. 1 sold - 5 passed in. Unrealistic vendors were the main problem with that. There were certainly serious buyers there but the auctioneer didn't look like he was getting close to putting most of them on the market.

Lots of agents circulating around "assisting" (pressuring) buyers to bid and then "consulting" (pressuring) vendors to drop the reserve when the bids didn't make it. Not to mention the technical failures and casual method of running the auction with the auctioneer just disappearing out of the room for indeterminate lengths of time in the middle of it all. Pretty unprofessional really.

Quite a sorry state all around... although the agents didn't seem to be too fussed - obviously they got their fees.

 

[Peter Parker]

My last IP was bought at a Ray White auction (in an outer suburb that hates auctions) in 2007

Good on you Ray White for doing both buyers a disservice by failing to signal price

That would turn me off if I was a first buyer too.

But as an investor I knew what was good value and what wasn't, so the lack of an asking price, the poor attendance or the miserable rainy day weren't a worry and might have even helped.

So I'd agree with you from the sellers point of view, but for a buyer it's great

 

[boomtown]

Dont get me wrong - Ive got a pretty good idea what a property is worth. But I have no idea if the vendor is realistic or a just a dreamer if there is no price indication at all.

If you are looking at 150 properties - its a hell of a lot easier to cull them if you can sort out the dreamers right away. Which means its more efficient to just to ignore anything listed with Ray White.

But I dont think Ray White cares that buyers get annoyed - they make more money from their vendors not selling - Ive seen vendors go to auction twice at 10k a shot and fail both times. Thats 20k, more than most commissions and the seller doesnt have anything to show for it. Way to go guys.

 

[urban cowboy]

cards on the table first - I have recently become an ex-agent - but have never worked for Ray White - though have a few friends that do...silly buggers

hate to disappoint you Boomtown, but this is going to become more prevalent as time goes on...

most franchises and the independent RE training groups are all advising to market without price (it's effectively an auction marketing program without the auction).

there are two main points being thrashed around...feel free to agree or disagree with them at will...doesn't bother me either way!!

1. it is widely regarded as a fairer way of doing business - the buyer should do their own homework and work out what they are prepared to pay for the property and the seller attracts more people to the property as there is no "price band" as such - hence more of "the market"to provide price feedback to the seller so they do not list at a stupidly high price and there is more chance of them selling at market value.

2. In this day and age of requisite agent bashing - many people believe that all agents buy listings by setting the prices high, or are incompetent of setting a proper price due to lack of knowledge. This way, the agent is able to market the property based on its features and the price does not come into it until the buyer is ready to put in an offer - the agent cannot then be accused of interfering with price issues and simply becomes a conduit for negotiation between parties - which is their property job anyway...marketing and negotiation.


there are going to be people who vehemently disagree with me here on this one - and that's OK!! but i do agree with it to a large degree.


there is of course the work around that i have been telling people about a fair bit on here and everyone should know - about how to get the adprice of REA to show the price at which the agent has marketed the property - even if it is not listed in emails or on the listing on REA.

hope this makes sense...

 

[urban cowboy]

Ive seen vendors go to auction twice at 10k a shot and fail both times. Thats 20k and better than most commissions.

just want to clarify...not quite sure what you are getting at there...can you rephrase for me??? might be the red wine dulling my senses!

 

[boomtown]

just want to clarify...not quite sure what you are getting at there...can you rephrase for me??? might be the red wine dulling my senses!

Vendor goes to auction and pays $10k in fees for the privilege. Property fails to sell.

Property goes off market for a week then magically back on market with same agency for private treaty sale.

*wait 2 months*

Vendor goes to auction again and pays another $10k for the privilege. Property fails to sell again.

REA pockets the better part of $20k.

Just to give you an idea - I got a Ray White email today. They have 17 properties listed - every single one going to auction. Thats 170k in fees and charges. And I bet they only sell a couple of them. Thats a rort plain and simple - they are making much more money from properties that dont sell than from those that do.

 

[urban cowboy]

ok got your point...but where does the 10k in fees come from???

because an auctioneer costs about 500 dollars (auctioneer gets - agent doesn't get any).

and 10k is about right for a full marketing program for a decent house, but under Qld law, the agent can only charge what they are charged by the provider of the service (newspaper etc.) i.e. an agent cannot profit on the marketing of a property...

where is the 10k profit coming from??

 

[wylie]

Where do you get the idea that it costs a vendor $10K in fees and charges to Ray White? It doesn't cost anything more (except some vendors pay for an auctioneer, but not all vendors have this cost) except the advertising that agents like to push onto the vendor. If it doesn't sell, it doesn't cost anything (except the the small fee for the auctioneer if there is a fee involved).

What fees and charges are you talking about?

 

[urban cowboy]

hey sis!!

 

[wylie]

Yo Bro

 

[boomtown]

My brother is an REA and indicated 10k to go to auction.

Mostly in advertising I would have thought the money goes. I've always thought that REAs take a massive cut of the advertising costs through design and lay out charges, taking photos, signs etc (mostly because that is how advertising agencies have traditionally worked) but I'm happy to be shown to be wrong on this point - it makes me feel much better.

Doesn't mean that I'm not annoyed about a complete refusal to quote indicative prices though !

 

[urban cowboy]

that's ok Boomer...it is a common misconception...i can't speak for other states, but I can confidently state it is illegal for an agent in Qld to make money on advertising.

They possibly could make a small amount on signage and piccies if they really wanted to - but it would be negligible and the methods imposed to pull that sort of deal off wouldn't be worth the hassle.

i understand your frustration on the pricing issue - but referring to my earlier post I do reckon it is a fairer way of doing it...and there are ways and means of finding out the ballpark figure.

 

[boomtown]

*Deep breaths*

I know the source code - any other tips?

 

[Collector]

couple of things.....

Marketing costs for Auction vary greatly depending on the level of marketing, floor plans, professional photos etc.

Our agency occassionally auctions properties, our marketing caimpain consists of $1500.00, $2,000.00 & $3,0000. We provided the vendor with an itemised list of each product for each priced campain and we let them decide how much they would like to spend, i also point out that for a $1,500.00 campain we would spend between $2,200 & $2,300, for $2,000 we would spend $2,800 to 3,000 and for the $3000 campain $4,000 to $4,200.

In NSW it is illegal to get "kick backs or discounts" unless it is disclosed to the vendor.


In regards to newsletters and general marketing of properties we advertise with a fixed price (apart form actions), we do not have price ranges or quotes like "more than" or "+". We try to provide as much information in our advertising as the space will allow, including land size, strata fees, council rates etc - we do this so we don't waste peoples time - I hate it when i search for property on the internet and they don't provide that info - i like to do my sums before i even call the agent to see the property.


Like others have said and i have seen it a lot in my area, agents who don't advertise with a price don't know how to value a property.

 

[urban cowboy]

Like others have said and i have seen it a lot in my area, agents who don't advertise with a price don't know how to value a property.

sorry mate, but gotta disagree with you there - that is a load of rubbish and I have explained why above.

 

[Collector]

sorry mate, but gotta disagree with you there - that is a load of rubbish and I have explained why above.

I don't really care for your reasons.


The facts are simple - buyers today want to know as much as they can about a property in the shortest time - we are all time poor and unless the property stands out they will move onto the next one.

Buyers want to know the price - they don't want to guest it, they want to be able to view a property on re.com and see the land size, they want to know the address so they can drive past or view via google earth. They want as little contact with the agent until they know the facts and then they will inspect the property.


There is an exection to this, and they are the people who go for a drive and see some direction signs for an open house and decide to have a look, and they fall in love with the property - how many time do you think that happens?

 

[urban cowboy]

and i'm not particularly interested that you don't care - it's still a load of rubbish and that is why most major franchise groups and most of the major real estate training organisations in this country are moving towards a no list price method.

There are sooo many stories of agents being caught out overpricing and listing at high prices just to secure the listing...Whether a property has a list price or not has no bearing on the skill of the agent - as an agent i would have hoped you were smart enough to realise this. An agents skill is in effective marketing and negotiation - whether a list price is on the net has absolutely nothing to do with that.

real estate in this country is changing - and changing fast...those companies that don't embrace the changes (whether they agree with them or not) will be left behind.


Boomtown - what other answers do you need mate - happy to provide any info I can...

 

[urban cowboy]

actually - just to prove a point...

current research shows that buyers will often spend 20% more than they originally intended - or told the agent etc... (it is where buyers are liars started - a phrase i detest by the way)

lets say a buyer thinks they intend to spend around 500k for a house - with prices listed they will search from about 480-530.

Take the price out of it - they will look at the photos and the blurb - they fall in love with the property, not the price...negotiations start and using that 20% figure they end up spending upto 600k to secure the property they love as they have no preconception of the price other than their own research.

clumsy analogy, but it works...

as i said - it is the same as auction marketing without the auction. The figures are there to show auctions work when performed by a competent agent and auctioneer - the same applies here.

it all comes down to competence - something that is often sadly lacking in this industry.

 

[Collector]

and i'm not particularly interested that you don't care - it's still a load of rubbish and that is why most major franchise groups and most of the major real estate training organisations in this country are moving towards a no list price method.

There are sooo many stories of agents being caught out overpricing and listing at high prices just to secure the listing...Whether a property has a list price or not has no bearing on the skill of the agent - as an agent i would have hoped you were smart enough to realise this. An agents skill is in effective marketing and negotiation - whether a list price is on the net has absolutely nothing to do with that.

real estate in this country is changing - and changing fast...those companies that don't embrace the changes (whether they agree with them or not) will be left behind.


Boomtown - what other answers do you need mate - happy to provide any info I can...

Do you realise how stupid that sounds?

What you are saying is that agents are moving to no list price so they won't get caught out overpricing the property. PLEASE.....


So that makes it ok for an agent to buy a listing - this justifies it.

We operate completely different, we don't overprice for the sake of gaining the listing, we often tell vendors (who want to ask more that our esimate) that we are not interested in their listing at that price, why would you carry a property on your books that is overpriced and needs to be reduced to meet the market - hang on - i get it - you list it for more that what it is worth - you don't advertise a price, you get a lot of low ball offers and submitt these to the vendor and then you condition the vendor into reducing their price, in the mean time you have tied the vendor up in your agency agreement to the point that it is going to cost them thousands to change.


What you are saying is that it is now longer the agents job to be concerned in esimating prices rather the agents job is to market and negoitiate>


Buyer will pay an extra 20% - you are kidding, buyers want the property for as cheap as they can get it..

And its not up to the agents to dictate to the market in regards to advertising no price - its the market that dictacts.

If a buyer was to call you regarding a property advertised without a price, what is the first questions they are going to ask - wait i know - WHAT IS THE PRICE?


To me a property that has no price listed or had POA or Expressions of Interest is a property that is overpriced.