Vendors find it hard to listen to real estate agents who tell them their house is worth $75,000 less than what the neighbours sold for 18 months earlier. Many agents say they lose listings to competitors who are less rigorous with the truth and are happy to talk up a property's value. Agents can cause major problems for their clients if they raise false hopes. If a vendor is planning to buy another property on the strength of an inflated sale expectation for their existing property, they could end up 20 to 30 per cent short on their next house. Many agents lose listings to unethical competitors who talk up the price, knowing full well the property will never achieve the mark. It's so difficult to get an honest agent who will give you a realistic price because most vendors are going to go with the guy who quotes the highest figure. As hard as it may be to stomach, the agent who quotes lowest is probably the most honest. If we don't price a property within 3 per cent of what the market will pay, buyers will sniff it and it won't sell.
THE SECRET SALE
One recent technique in selling involves not disclosing the exact address or the price in sales advertisements, and not doing open house inspections. The intent is to encourage a potential buyer to pick up the phone and talk to the agent. I believe in 100 per cent disclosure, anything else is just wasting time. Buyers can become irritated by the tactic and move on to a property that does display the price.
EXPRESSIONS OF INTEREST
Although this method is not favoured by all agents, it has begun to appear more often. Critics say expressions of interest (EOIs) are not designed to help the time-pressed buyer sift out the properties which won't make it onto his shortlist. Most people want to look at a price and decide quickly whether it's even a realistic hope, rather than be asked what they think it is worth. EOIs have a better success rate at the top end of the market rather than for the middle to lower ends.
SET THE PRICE
Every vendor has high expectations, you have to make inquiries around the area, look up recent sales in the area. It is very tough because if the agent comes in with price 'x' and the vendor was hoping for 'x' plus $100,000, the vendor can be very depressed. Vendors become more realistic about price once they have gone out and had a good look at the market.
TRUST YOUR AGENT
It's fine to like your agent - just don't love him. Don't disclose too much about your own situation because the buyer and the agent will use it against you. Keep your cards to yourself - it's still a game of poker. If the agent knows you're desperate, it's great for him and he'll use it against you if you're not careful.”
DROP THE PRICE
A good time to evaluate your sales campaign is after about three to four weeks on the market. This is when a good agent will be able to talk to his client about the feedback from potential buyers. Act on the feedback. Good agents get as much feedback as possible at inspections, but more important is to follow up the next day on the phone. That's when people will be honest about how they feel about the property and what they're willing to pay for it. The danger with putting a property on the market too much above the market is that when the vendor brings the price down, there is a feeling there must be something wrong with the property. Beware the whiff of death.
BUYING AND SELLING
The experts agree that the golden rule is to buy and sell in the same market. That rule only works if the same amount of skill is used in selling your existing property and in buying your new property. The fact is people buy emotionally. So if you undersell and then pay too much, you end up in trouble, regardless of the market.