There’s no question that the real estate market is becoming more and more competitive for real estate agents looking to acquire properties to sell.

I believe that the quality of agent has improved dramatically over the past 5 years with many agents offering quite a persuasive presentation to any potential seller.

With increased pressure on commission rates, there’s a temptation for owners to attempt to sell a property themselves…or at least try a low-cost alternative with plenty of discount agencies out there in the market place today.

My team and I are very fortunate that much of our business is repeat and referral from past clients but when we’re looking to obtain new business (and the client has not had previous dealings with us in selling a property), it’s amazing how many times a seller will choose an agent based upon as little as 0.1% variance of the final selling price in terms of the commission rate.

If you’ve followed my blog for some time, you’ll know that I believe many agents (despite having a good sales pitch when they tout for business) are poor marketers and very poor negotiators.

We regularly see properties sell for 5-7% less (sometimes even 10% less) than what another agent is achieving on properties that can be almost identical homes in almost identical positions on almost identically sized blocks of land.

Any time we lose a listing, I’ll be honest – I feel sick in the stomach…at least for a few minutes!

We put so much into our appraisal and know how hard we work to achieve prices that we believe are amongst the highest in the area based on many things but most importantly, our ability to market properties effectively (in terms of quality and effectiveness) and our ability to negotiate an offer.

I remember a situation around 5 years ago I sold a near new home for $400,000 about one month after another agent sold an identical home (same builder built at the same time) on an identically sized block of land…only 3 doors away in the street for $340,000.

The bizarre part of this story is that I was asked to appraise the home that sold for $340,000 and I lost the listing based on the fact that my photographer cost $100 more than the photographer the other agent used.

I remember thinking that this was a rather expensive $100 saving!

I recently lost a listing to an agent that offered a rate that was 0.5% cheaper than the rate I was offering, based upon our ‘sliding scale’ where we are happy to be paid a rate based upon the price we achieve.

In this instance, the other agent appraised the property for $40,000 more than we believed it to be worth but if this property sold for the price that the agent suggested, the 0.5% difference in commission equated to a little more than $2500.

If I ever lose a listing to another agent, I’m always respectful and polite as I do realise that it’s hard for any owner to make a decision when they often only sell a property every 7-10 years (on average).

I mentioned to this owner that if I couldn’t prove I was worth 0.5% (or $2500) more than the other agent, then the other agent deserved the business…and I truly meant this!

In other words, the owner couldn’t see that this agent was worth any less than 99.5% of what we offered in terms of experience, results and our thorough processes.

I researched the particular agent that listed this property and based upon his last 10 sales, he was selling properties at an average of 95.8% of the prices they were listed at.

He had an average sales price of around $511,000 over these last 10 sales so in other words, he was selling homes an average of $21,500 less than what they were first listed at.

Over our last 20 sales, we have averaged a selling price of 102.1% of original list price with an average sale of approximately $646,000.

This means that we are selling properties an average of $13,500 above the listed prices…a variation from the other agent of approximately $35,000.

Please don’t think I’m trying to beat my chest and use this forum to tell you how good we are…I know you hear this repeatedly every time you open your mailbox and pull out the 2-3 agent flyers that are sitting there wrapped up amongst the Coles and Woolies’ catalogues.

What frustrates me is that many sellers simply don’t know what they don’t know…and with data so readily available on the internet today, it’s not too hard to work this out yourself if you’re prepared to spend a few solid hours of research online before making your decision about which agent you’ll choose.

I really do believe that many sellers don’t realize how much of a difference in price that a good agent can make compared to an ordinary agent.

Recently, I encouraged a seller to do his own research when he told me that he was finding it hard to choose which agent to list with.

He mentioned that he didn’t have time to spend a few hours checking out results of his shortlisted agents’ latest sales after I recommended that he do this.

If he knew that the difference was as high as $35,000, he may have made the time necessary, as a net amount of $35,000 probably equates to a gross income of approximately $50,000 – and this is almost 3/4 of the average person’s yearly wage….or to put it more succinctly, 9 months of their working lives with one single decision.

How could you NOT afford to spend a few hours to ensure you’ve made the best decision that you can?

Again, I’m not here trying to blow my own trumpet but I do encourage you to spend the time researching results of your potential agent rather than relying on nothing more than a smooth sales pitch.

Until next week, Happy Listing & Happy Selling!

My ‘Feature Property Of The Week’ is 12 Lacewood Circuit, Warner

4+ Bed / 2 Bath / 2 Car

Offers Above $580,000

Open Home – Sat, 23 Sep 9:00AM to 9:30AM

A stunning low-set family residence offering 4 bedrooms plus a separate study, multiple expensive living areas, a fabulous upmarket kitchen and a huge private outdoor entertainment area that overlooks your large leafy backyard. Offering a side access for trailer or small vehicle of your expensive 820m2 block, there’s loads of room for the kids and pets to run around whilst still offering providing ample room for an in-ground pool. This home has been immaculately kept and truly offers outstanding value for money – be quick! It’s brand new to the market and already attracting significant interest!

Did You Know?

‘The Michael Spillane Team’ has averaged a selling price of more than 101% of the original list price over every sale that they’ve made over the past 8 years. That’s quite a record.

Michael was runner-up at the 1999 Springwood Tavern Karaoke championship!

Fun Fact….

In Japan, letting a sumo wrestler make your baby cry is considered good luck.

Quote Of The Week….