what is a REA agent's advertising cost?

[quintets]

I think I may have found a reasonable agent with integrity to sell our PPOR (private treaty).



He had a great appraisal and marketing presentation and had a definite and coherent approach for our place. The upfront commission is 2.2% which INCLUDES advertisting costs. If we don't sell, then we just pay the advertising cost. I haven't asked him what that would be yet. Now I just need to know what should I expect in terms of advertising costs?

He wants to do a standard picture board in front with internet (domain only)/print campaign and flyers/brochures and open house.

I've heard DIY selling may cost under $1000. Is that representative of what the agent may try to recover?

Jireh

 

[duncan_m]

He wants to do a standard picture board in front with internet (domain only)/print campaign and flyers/brochures and open house.

When I was much younger, naive and innocent. I engaged an Agent to sell an $85,000 unit.. it didnt sell after about 10 weeks, so I rented it out.. using the same agent's firm to manage it.. Manage it they did for about a year, and utterly stuffed that up.. the place got trashed.. I dumped them and moved the property to another Agency..

I got the bill for the Advertising on the attempted sale after I dumped them as the managing agent. $1600. or 1.8% of the value of the property!.. I gingerly exchanged a few letters with them questioning the exorbitant costs and then got a very nasty solicitors letter that had me scrambling for my cheque book..

Mea culpa for not fully appreciating what I was signing when I engaged them to sell the property.. Shame on them for taking advantage of me.

The principal of that same Agency.. well he's the El Presidente of a very large Real Estate Agents errr.. support group in SA.. maybe he should institute some changes in the Industry..

As an aside.. they also put a very very large glossy sign up.. It had a beautiful photo of the outside of the unit.. the same view you get when you're standing in front of the sign.. duh.. The prominent main road position of this unit of course gave them a wonderful opportunity to spam passers-by with the details of their Agency and a beaming cheesy smile of the ho who was selling the place.

They didnt even use vaseline on me. Nothings changed..

My advice.. have them detail every cost they intend to incur and at what point they intend to incur these costs.. force them to come back to you for approval if the costs vary or when the initial marketing campaign has finished and they want to kick off another.. You also need to fully appreciate that Advertising is a PROFIT CENTRE for some Agents.. they MAKE money from Advertising.. they charge Vendors (or "my vendor" as they so like to say) more than it costs them to place adverts.. there's rumours of kickbacks to Agents from the Print Media for placing large volumes of Ads (no evidence, sorry).. Get your own quotes for signs, print media if you feel the costs are too high...

Do NOT trust them, document, verify, check.. watch them like a hawk..

Above all else.. consider selling it yourself..

 

[lizzie]

in all the properties i have sold - or not sold - i have never paid advertising as part of, or on top of, the commission.

all have been "no sale, no money" - including the current one i have for sale at 2.2% commission. granted most have sold and i do follow the advice of the agent re value (although i have a very good knowledge of what the proprty is worth and the agents seem rather relieved at this). but i will never sign anything that charges advertising regardless of whether it sells or not.

they get paid enough as it is - and advertising costs them very little in the overall.

 

[RichardC]

It seems to me the real winner from advertising is the agency which gets it's name up in lights but it's the punter who pays for it.

Ditto open-houses. The agent's long term interest is in meeting prospects on both the buy and sell side. Many thinking of selling their home go to the local open-houses to get a feel for the market. Great way to get new listings LOL

 

[quintets]

Hmmmm, I just re-read the marketing booklet the fella gave me. It's quite clearly stated that the advertising cost is built into the "successful sale fee" and "No Sale, No Cost" for private treaty assuming the property is not withdrawn from sale.

Thanks Duncan for making me double check what I had read.

He's the only REA who gave me a very detailed booklet on all aspects of the appraisal and marketing plan and costs. It looks like the lion's share of the risk is with him. He's given a written appraisal of the market price as well as the premium price we'll start the listing at. I suppose that's how he can support a no-sale, no cost fee. He did tell me that he turns people down if he thinks they are asking too much money.

I just need to double check it's a 3 month sales cycle.

Okay, here we go.

Jireh