Advice for selling privately

[The New Kid]

Hi everyone,
I have a property which I am about to put on the market and was after any advice as to the best method suggested in selling privately - or should I bite teh bullet and go through an agent??
I am keen to sell by tender, but am unsure about how to go about this.

Any advice would be greatly appreciated!!

Many thanks

[alhoon]

Hey TNK

Get a valuation so you know want it's worth.
Trade Me works well.
Keep you emotions out of it, if you can’t you’d be better with an agent.

Just my 2cents best of luck.

[xris]

Hello new kid,

Welcome,

I'd suggest

1/ Do not tender.

2/ Engage a competant RE agent who sells a lot in your area.

xris

[Edinburgh]

I have had good success with Homesell and am about to use them again.

[Julian Grainger]

Get someone who caps their commission. Same service, half the money. Jones, Borders, Gecko etc

[Don and Liz]

believe it or not

i reckon sell with an agent. get a recommendation for a good one. sign up for a short (but realistic) listing period. In a perfect world the agent should be able to get you the price you would accept privately plus what they need to make it worth there time to sell it for you rather than your price minus their commission. cheers

[Oopsick]

A good agent deserves their full comission as they can free you up from a lot of hassle and get a very good price...

[Edinburgh]

A good agent deserves their full comission as they can free you up from a lot of hassle and get a very good price...

No agent actually earns 4% on a house sale, especially if it is a higher value sale. The return for the time, skill and education they apply is just ridiculous. Ask yourself, do your accountant or lawyer or doctor or anyone charge like they do and this is after they have done a 3 week course.

NZers don't know any different, but I lived for 15 years in Scotland where perhaps as many as 90% of house sales are through solicitors' marketing depts and you pay 1%. Okay, you have to show the property yourself but I tell you it is no hardship and based on my experience I would do a better job than 99% of agents.

The systems they have set up are much, much better for the marketing of your property and with most of it selling via tender, you can be sure of getting the best market price.

NZ should wake up and kick the real estate industry where it hurts. We are being ripped off as a country.

[mlkmnz]

Agreed with Edinburgh, 99% of agents I've encountered are crooks primarily interested in their own pockets and couldn't care less about the vendor or buyers.

If your property is pretty standard (i.e. not worth in the millions and not too quirky) I'd do some research of sales in the area, maybe get a valuation of the property and have a crack at marketing it yourself somewhere like Trademe.

Oh and stay the hell away from Tenders, they're the only selling method worse than an auction. I'd select the price you want and run at that. Its straight up and although agents like taking the shotgun approach to getting prospective buyers through at least the people interested in your property will be interested at the price expectation you have set. Nothings more annoying than shopping for a house and having to play they "whats the price" game.

[Riviera]

Don't want to hijack TNK's post,I am currently looking at selling my dairy farm and we have had an agent suggest that we put it up for tender also (to get a feel at what the market will pay). Why are you against tenders Xris? seems to me like a good way of finding its value without showing your hand. I also agree with Edinburgh that we are being ripped off by agents because there commission on our deal would equate to 4% up to $500,000 then 2% above that.
This would earn the agent between $130,000 & $160,000 not a bad hourly rate for 6 weeks marketing of which we have to pay the advertisings costs. Has anyone set up there own tender before and how difficult is it? I don't see how an agent can be worth $160,000 just to do a S&P agreement and show a few people around.

[mlkmnz]

Tenders are absolutely awful, vendors undertake them on the expectation of some rogue offer well above market value but in reality it scares more buyers away than anything. Most people should be able to work out the value of your "hand" within about 10% or so (unless of course your expectations are ridiculously higher than what the market value of the property is).

I've had the most success selling properties on a price I've set. Tenders, auctions and other fixed date selling methods add a lot of emotion to the selling process which can lead to acts of desperation. YOU know what you want for your property, so let people know and if it sells it sells, if it doesnt no biggie. The alternative is having it fail at tender then loiter on the market for 6 months given the momentum has been lost. Agencies like to keep information to themselves, but if you did some investigation on the successful sale of properties at tender or auction you'd find they're no where near as successful as agents make them out to be, most properties will sell after auction or tender....

[Edinburgh]

I don't see how an agent can be worth $160,000 just to do a S&P agreement and show a few people around.

They are not!

Of course, a farm is a business and there should be more work to do but it is woefully excessive.

Why don't you ask him how many hours he would typically spend and then divide his commission by this. You will find he and his ilk are the best paid people in NZ.

This is especially the case with dairy farms which, lets face it, must be the most saleable bit of real estate in NZ at present.

Agents will tell you that they spend long hours and many do, and many of the hours are unsociable - often they are spent on properties that don't sell. But why should you pay for that?

The only time you should pay for is that time spent on your property.

The whole charade stems from people usually selling after some time and therefore realising a sizeable capital gain. If it was not for this, agents could not get away with what they charge.

The method of charging is also wrong - they still use percentages although property values have shot up in recent years. I would rather pay a fixed price for marketing.

My advice to you Riviera is shop around, although I suspect you will find this is a cartel - ie: all the agents maintain the same rates.

Another thing you could do is sell it yourself - find out how dairy farms are purchased - milk yield is a big factor isn't it -and package all those factors together. Look at the stats for some recent sales in your area and see if you can get a feel for what your farm is worth or pay for a valuer.

So, you have all the info a purchaser would want plus an idea of a fair price. All you need then is to find out how to advertise it to the right people.

This is the tricky bit because estate agents keep non estate agents out of the main property magazines, but perhaps an ad in your local paper or a farming magazine would do the trick.

Or you could take the direct approach. Many dairy farms are being bought by companies - if you can identify some, write to them directly.

Good luck.

[xris]

Hello riviera,

It is impossible to be black and white about any particular method of sale because each situation is different. However, one can talk in general terms about each method.

Don't want to hijack TNK's post,I am currently looking at selling my dairy farm and we have had an agent suggest that we put it up for tender also (to get a feel at what the market will pay). Why are you against tenders Xris? seems to me like a good way of finding its value without showing your hand.

Your agent should know its value to aroung 10%. ThaT IS PART OF HIS JOB. If he doesn't then don't use him. To tender solely to find out 'what the market will pay' is deplorable. There are very few properties that cannot be priced, and in my opinion they are the ones best suited for auction.

Tender, like auction, requires special skills and should not be undertaken by somone who has no or little experience. Selling/marketing by the usual method of sale is not the same and this is where a lot of 'experienced' agents can come unstuck.

My objection to tender is perhaps a personal one. Are you on the market or aren't you? If you are then load up and fire off all the cannons and fireworks to let people know that you are seriously on the market, and stop taking the cowardly way out, which only confuses and frustrates people. At least with auctions buyers know where they stand.

Hello edinburgh,

The only time you should pay for is that time spent on your property.

This sounds grossly unfair and illogical to me.

Selling is not the same as stacking shelves. A good seller can add 5% to the market value in only a few seconds with a buyer. Similarly a bad seller can lose 5%, although I think this is less likely.

It has nothing to do with the hours spent phoning people, putting up signs and running open homes.

And what has education got to do with it? (refering to an earlier comment). A pay cheque should not be based on a person's education level but on how good they are at the job (which is often related to their education of course, but not necessarily so.) I know some excellent agents who are semi-litterate but they get top dollar for their clients, and some highly qualified people who are disfunctional nerds. Go to any university to indulge in some nerd spotting. (I am putting up the storm shutters now as I type this).

xris

xris

[Edinburgh]

Hello riviera,

Selling is not the same as stacking shelves. A good seller can add 5% to the market value in only a few seconds with a buyer. Similarly a bad seller can lose 5%, although I think this is less likely.



And what has education got to do with it? (refering to an earlier comment). A pay cheque should not be based on a person's education level but on how good they are at the job (which is often related to their education of course, but not necessarily so.) I know some excellent agents who are semi-litterate but they get top dollar for their clients, and some highly qualified people who are disfunctional nerds. Go to any university to indulge in some nerd spotting. (I am putting up the storm shutters now as I type this).

xris

xris

I have to disagree.

I have never seen an agent add 5% to a house. Typically they are trying to get you to knock this and often more to meet a low offer, especially when the market is difficult as it is now.

I know nice people who are good agents within the limited confines of what makes a good agent, but the fees they earn are still not in line with what they do.

I have asked many agents to justify their fees and the most common response is the number of hours they work - but how many hours do they work for you, whether directly or indirectly?

Too many agents will take a listing at the vendor's price, knowing it won't sell at that price. They waste time, hoping to get that vendor to come down and then tell you they are working really hard.

As for education, by that I meant their professional training. Lawyers, accountants, doctors, engineers, tradespeople they all do years of training and that is a large part of what you buy.

An estate agent does a 3 week course. It is full of people who used to do other things because it is so easy to get into. They are not even good salespeople.

I have lost count of the number of open homes I have been to where the agent stands there and takes your name - period. Ask them for something basic like the size of the section or size of the house and they won't know because they weren't bothered to find out.

Heaven forbid they should actually ask themselves who the property most appeals to and market it specifically to that audience.

I repeat, I know some really nice people who keep in touch and try to find me properties I will buy, but it is not rocket science and should they be getting $20k plus for phoning someone up and walking around the property with them. No they shouldn't!

I much prefer the Scottish system, but if we are to keep the system we've got then we should start having some realistic and appropriate charges.

[Julian]

Riviera,

The bulk of your sale would be at the 2% level. If the agent gets just 5% more for the property than you can selling privately you would be in front using the agency - irrespective of what it costs!

It can be easy to miss the forest for all those damn trees.

Julian