Last week, I shared some ideas on how to research the agents that you’re considering and determine whether they’re working in your best interests in seeking to obtain the highest possible price or whether they’re working in their own best interests and trying to secure a quick sale with minimal effort.

Here’s another three ways that might give you a better indication of how they operate…

By the way, if you missed last week’s blog, you’re welcome to e-mail us back and we’ll forward the first part of this discussion to you.

3. Research the Agent’s Average Days that a Property is on the Market – the way you interpret this figure may not be what you’d think! Recently, I watched an agent from Melbourne that was interviewed on ‘Sky Business’ (Foxtel) and he was stating how he sold his last few properties in anywhere between 4 and 8 hours of being listed for sale…. yes that’s right, 4-8 hours (not days).

Whilst there are times when the perfect buyer may be on the agent’s database and act very quickly, I find it hard to accept that any agent could look a seller in the eye and tell them that the offer in front of them was the absolute highest that the market is prepared to pay when 99% of the market doesn’t even know that it is for sale. In my opinion, if an agent sells properties consistently in a very quick time frame, there’s every chance that their focus is selling them as fast as they can, rather than obtaining the highest price available in the market.

I openly admit that we are not (on average) the quickest when we list properties for sale as there are agents that have a lower number of days on market than we do but I’ll stand our results up against any agent in terms of the price we sell them for.

In my experience, 98% of sellers prioritise the selling price over the time frame it takes to achieve this price, so this should be the agent’s priority rather than trying to eliminate the time that the home is on the market.

So, if you research an agent’s recent sales and many of them sell before the first open home, this might give you a solid indication of whether their own needs are more important to them than their client’s needs.

4. Research Price Reductions – This data can be very incriminating and often places a very accurate reflection of the agent’s motives. If an agent lists a property for sale and the price is reduced quickly and by a large amount of money, it’s pretty obvious that you’ve found an agent that just wants it sold for any figure. Unless the sellers have a very tight time frame, we rarely reduce the price of a property within the first 4 weeks of a campaign…and even if we do need to reduce the price, the amount of usually relatively minimal.

Only last week, we sat with a seller that had their home listed for sale last year with another agent, and within 2 weeks of the property being listed on the market, the agent strongly encouraged the owner to reduce the price by $50,000 (and the original listing price was the exact amount that agent had had suggested from the outset!)

The home was originally listed for ‘Offers above $649,000’ which means that the agent wanted a change to ‘Offers above $599,000’.

In my view, price reductions of this magnitude really show an agent up to be feathering their own nest.

With the internet providing so much data to buyers these days, a price reduction of $15,000 – $20,000 could have made a huge difference to the outcome (when considering properties in this sort of price range) and if this amount could be the difference between few inspections and a packed open home with many willing buyers.

So, if the home was a little over-priced at ‘Offers above $649,000’, (let’s say the market value was really $630,000), the agent that recommends a reduction of $50,000 will likely undersell a home by a reasonable margin.

If there’s evidence of this sort of activity in an agent’s recent history, my advice is to ‘run for the hills’.

5. Research an Agent’s Last ten Sales – This one may require a little detective work and some effort but if you were to work out how the final selling price compares with the listed price for an agent’s last ten transactions, this will provide an indication of whether the appraised figure is comparable with what’s actually happening in the market place.

Similar to what I suggested last week with talking to the sellers of a property that the agent didn’t sell, I’d ask the agent for the contact details of a few sellers that seemed to sell for less than the original list price and find out more about how the agent handled the sellers. Were they happy with the experience and simply had a tight time frame to adhere to…or did the process leave a bad taste in their mouth based upon the agent’s pressure to reduce the price quickly?

Another way to obtain more information is to speak to the buyers (the new owners of the properties that were sold) and find out whether the agent really made them stretch or whether they were prepared to pay more but managed to ‘out-negotiate’ the agent…and inevitably, cost the sellers significant money – this can speak volumes about the agent’s ability and willingness to go the extra mile for their sellers.

So hopefully I’ve been able to provide some insight into what to look for when choosing an agent.

Unfortunately, most people don’t go to as much effort as this and base a good part of their decision upon the quoted appraisal price and upon the agent’s success fee.

Whilst these factors should be a part of the decision, basing a choice on these factors alone can be one of the costliest mistakes a seller can make in their lifetime.

Until next week, Happy Listing & Happy Selling.