This week I was on the phone to another agent as we discussed the current market.
It’s not at all unusual these days for agents to talk amongst themselves on a regular basis.
Agents compare their experiences in an attempt to gauge where the market is heading and whether there is an increase in sales.
I mentioned I had received an offer of acceptance on a property that had been on the market for less than a week.
This is almost unheard of these days.
He responded by saying, You must be working with a realistic vendor.
How true! In a slow market that is contending with interest rate increases, government taxes and a slide in property prices, you must price your property accordingly if you want to sell.
It is astounding after more than 18 months of price correction in Sydney that many properties still have such high and unobtainable price tags. Recently the Real Estate Institute of NSW (REI) and the Office of Fair Trading introduced a range of new guidelines that all agents must adhere to.
Interestingly, one of the new regulations requires agents to provide vendors with realistic price ranges regarding the sale of a property.
This price range must reflect current market conditions and an achievable sale price.
When a person decides to place their property on the market, it is not uncommon to request an appraisal from as many as three or six different agents.
When the competition is this fierce, some agents will do anything to obtain a listing. One of the most popular tactics is to price a property well above the marketplace reality.
Unfortunately this gives the vendor unrealistic expectations.
What then follows is weeks of phone calls from the agent to the vendor asking them to bring their price down.
Not only is this disheartening and stressful for the vendor, but it is also detrimental to the sale of the property.
The first few weeks a property is placed onto the market are when the most interest is generated.
You run the risk of losing potential buyers in this period of crucial initial exposure and the property becomes stale or old news.
The new regulation is set out to eliminate this over-pricing technique, so that properties enter the market with a realistic price.
Before you consider choosing an agent, you need to look seriously at recent local sales.
If a property in your area sells at a price much less than you expected, you may not like the result.
This is because you know this reflects on the potential sale price of your own home. Of course there are many variables.
Your home may be a completely different product as it may be larger and renovated with off-street parking.
If your property boasts qualities the others don’t, then you would be wise in asking a little bit more.
After you have done the necessary homework, choose an agent who is familiar with local sales and one who provides you with an achievable price range.
Having said that, don’t be afraid to place a reasonable margin on your property that allows for negotiation.
Most serious buyers will initially give you a low offer, but will be prepared to come up if they really want it.
However, if no one is talking to you after one month, you may need to adjust the margin to make it more appealing.
These days you need to have a lot of patience when selling.
It takes a lot longer to sell now than it did two years ago.
Don’t make the mistake of blaming your agent if you haven’t sold within the first month.
Don’t go with the agent who gives you the highest price, as you won’t be doing yourself any favours.
Choose an agent who is honest with you, but more importantly you need to be honest with yourself.
Garry Rogl is senior property consultant with estate agents Planet Properties of Petersham.