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Cutting Commissions
05.11.05
By Catherine Smith
Last week we heard from the Real Estate Institute about the reasons for traditional commission structures. This week we look at alternative ways of selling your home.
Many New Zealanders have started shopping around for new, lower cost ways of selling their homes, saving thousands of dollars in agent commissions. In true Kiwi tradition, two of the more established options are do-it-yourself but with the back-up of experienced consultants to hold sellers' hands through the process. HomeSell, founded in Christchurch in early 2002, and Green Door from Nelson both provide marketing services for home-owners willing to put their own time into selling their properties.
"After a dreadful selling experience with a bad agent ourselves, we decided there has to be a much more credible, transparent way of selling property," says Green Door founder Jocelyn Thornicroft. "
But most vendors still need more than just an advertising package to get their houses sold: both Home Sell and Green Door emphasise the one-on-one help provided by their consultants to the vendor. And the happy sellers are not just at the low end of the market: Green Door's most expensive property sold recently for $6 million. Home Sell has several listings over $1.5 million. Green Door packages range from $300 to $2400, and the company also offers finance through GE for homeowners to prepare properties for sale. Home Sell's packages range from $695 to the prestige $1895, and are focused on their own property paper distributed in key markets. Both use the web, with Green Door recently introducing kiosk pods in high traffic malls.
The companies seem to be hitting the mark as both are growing rapidly. Home Sell claims to have doubled the size of the private sales market in its home turf of Christchurch to 14 per cent in one year. Green Door is now training a former consultant to the Irish Real Estate Institute to set up their first offices in Ireland.
But if sellers still want the involvement of an agent, Australian company Go Gecko has recently hit our shores, via the Bay of Plenty. Licensed real estate agents work for a set fee of $5950 (lower for properties under $200,000). Executive sales manager Allan Mitchell has already opened eight offices, with another nine planned for pre-Christmas and 12 more in January. Again, property listings regularly run over the $1 million mark, with some currently listed at $3 million or $4 million. Demand is high, with many offices handling up to 100 listings. Mitchell says the company is attracting many experienced agents who want to do business differently, and has already captured 7 per cent of the Tauranga market in the first six months.
But regular agencies are stepping up to the mark, too. Ross Cooper from Coopers Real Estate Rotorua heard sellers' feedback and now offers a combination of an early sale discount (if a property sells within two weeks), and scaled commissions that don't penalise higher value properties. "But most importantly, we add value," he says. "For their fee, clients get packing boxes and the help of our moving trucks and very focused service." After three years, just under 70 per cent of his business comes from referrals and repeat clients.
http://www.nzherald.co.nz/section/8/...ectID=10353558
05.11.05
By Catherine Smith
Last week we heard from the Real Estate Institute about the reasons for traditional commission structures. This week we look at alternative ways of selling your home.
Many New Zealanders have started shopping around for new, lower cost ways of selling their homes, saving thousands of dollars in agent commissions. In true Kiwi tradition, two of the more established options are do-it-yourself but with the back-up of experienced consultants to hold sellers' hands through the process. HomeSell, founded in Christchurch in early 2002, and Green Door from Nelson both provide marketing services for home-owners willing to put their own time into selling their properties.
"After a dreadful selling experience with a bad agent ourselves, we decided there has to be a much more credible, transparent way of selling property," says Green Door founder Jocelyn Thornicroft. "
But most vendors still need more than just an advertising package to get their houses sold: both Home Sell and Green Door emphasise the one-on-one help provided by their consultants to the vendor. And the happy sellers are not just at the low end of the market: Green Door's most expensive property sold recently for $6 million. Home Sell has several listings over $1.5 million. Green Door packages range from $300 to $2400, and the company also offers finance through GE for homeowners to prepare properties for sale. Home Sell's packages range from $695 to the prestige $1895, and are focused on their own property paper distributed in key markets. Both use the web, with Green Door recently introducing kiosk pods in high traffic malls.
The companies seem to be hitting the mark as both are growing rapidly. Home Sell claims to have doubled the size of the private sales market in its home turf of Christchurch to 14 per cent in one year. Green Door is now training a former consultant to the Irish Real Estate Institute to set up their first offices in Ireland.
But if sellers still want the involvement of an agent, Australian company Go Gecko has recently hit our shores, via the Bay of Plenty. Licensed real estate agents work for a set fee of $5950 (lower for properties under $200,000). Executive sales manager Allan Mitchell has already opened eight offices, with another nine planned for pre-Christmas and 12 more in January. Again, property listings regularly run over the $1 million mark, with some currently listed at $3 million or $4 million. Demand is high, with many offices handling up to 100 listings. Mitchell says the company is attracting many experienced agents who want to do business differently, and has already captured 7 per cent of the Tauranga market in the first six months.
But regular agencies are stepping up to the mark, too. Ross Cooper from Coopers Real Estate Rotorua heard sellers' feedback and now offers a combination of an early sale discount (if a property sells within two weeks), and scaled commissions that don't penalise higher value properties. "But most importantly, we add value," he says. "For their fee, clients get packing boxes and the help of our moving trucks and very focused service." After three years, just under 70 per cent of his business comes from referrals and repeat clients.
http://www.nzherald.co.nz/section/8/...ectID=10353558