6 Reasons why the Local Agent may not be your best choice!
So you're ready to list your home for sale and you're considering calling in the local agent to sell it because you believe that's the best choice for you, but is it really? Here are some important factors to consider when making that all important decision.
1. The local agent may be complacent.
If an agent has been working a particular area for a long time they may have a bias towards property values and not be in tune with what's going on in the markets around them. This could have the effect of selling your property short because the agent may be pre-conditioned to think that a certain high price is not achievable in the area they normally work because they have never seen it, but it is possible to set records. Recently I had a sale at 1 Shallots Close Glen Waverley that achieved a record price for the street! You can read a little more about that one here. The out of area agent needs to spend a lot more time thoroughly researching the area to make sure of the historical prices taking a very analytical approach which is what should take place not just going on a gut feel that many local agents do.
2. "We've got all the buyers"
This is probably the most used line by many a Real Estate agent "we have buyers ready to buy your place" but here's the thing, how does this help you as the Vendor? Think of it like this, yes it's true that the local agent who has more properties on the market would deal with more buyers looking for a similar product, however, all that does is make your property more vulnerable because the agent can quickly shift the focus of the buyer from your property to another more suitable property. The out of area agent doesn't have other properties to show the buyer and therefore will focus intently on selling them your home.
3. Buyers are not loyal to the agent
If a buyer sees a property they like they're not going to dismiss it because they don't recognise the brand or the agent. Look it at another way, does a buyer buy a home because they like the agent or the home? The buyer is not loyal to the agent! If the property is marketed correctly then the buyers will see the home and inspect it, it really doesn't matter who is selling it however, it is extremely important that the agent selling the home has a high level of skill to connect with the buyer instantly and create a relationship that will make the buyer feel comfortable dealing with them.
4. Is the agent advertising your home or their Agency Profile?
Local agents like to advertise in local papers. They will argue that you have to advertise your property in the local paper to attract more buyers. The reality is that the majority of buyers (as well as the older buyers that you'd think would use the paper) look online when purchasing, including via social media channels. Have a look at the screenshot of a recent facebook ad campaign that shows that about 1/3 of the people that looked at the ad were over 65 years of age, this is contrary to what print media advocates would have you believe. The local papers only build a profile for the local agent they do not help sell your property, they help sell the agent!
5. Can the agent's network refer buyers to your property?
Most traditional franchise office networks have designated territories and if a neighbouring agency of the same brand refers a buyer to your property, the offices have to share the commission. Here's a breakdown of a typical agent's figures: the agent that listed your property gets 40% of the total commission if they sell the property, the office they work for gets the remaining 60%. If an agent from another office within the network has a buyer interested in the property (and it's very common for buyers to cross over territories) and refers it to the listing agent, he typically looses 15% of the commission and the offices have to split their share of the commission (30% each) so everybody looses! It's highly unlikely that an agent would be encouraged to refer a buyer because there is too much income to be lost between all parties. Independent agencies like MP Estate Agents do not have territories which means that the agent makes most of the commission (up to 90% in some cases) so there is plenty of margin to allow the willing referral of buyers from associates within or external to the office thus increasing the chance of a sale.
6. The local agent is no longer the gate keeper of information
The tools available to licensed agents are very extensive and local area knowledge can be gained within a few minutes of research. In fact there are similar tools available to the general public on sites such as realestate.com.au and domain.com.au. In addition, sites like Google Maps and Apple Maps make it incredibly easy to get a sense of the area and the property and highlight many of the local amenities. Using sites like melbourneschoolzones.com.au allow you to easily determine the school zone(s) the property is in.
If you were sick and you wanted the best treatment would you go to the local doctor or travel to where you would find the best doctor?
So you can see it's not as clean cut as what you may have originally thought. In the end, when choosing an agent to sell your home the most important considerations are whether they have the skills to market thoroughly and negotiate successfully. Regardless of whether the agent is prominent in an area or not, the skills they posses are what's going to sell your home for the highest price in a reasonable time and with the least amount of stress. Consider this, if you were sick and you wanted the best treatment would you go to the local doctor or travel to where you would find the best doctor?
Max Pisano is the Principal of MP Estate Agents and the author of “The Ultimate Guide To Off Market Property Sales” get your free copy emailed to you by entering your details below.