Great questions to ask a real estate agent

[duvetray]

I am looking at investing in a city i have not done so until now, and need to set up a team, i have the property manager, but wondered if i could have some suggestions on searching questions to ask real estate agents to help to separate the best from the rest...?? A good selection would help and espeicially those that have helped you to choose agents that you work with closely now

contributions gratefully received

[LondonKiwi]

(1) Are you are property investor yourself?

Agents that are fellow property investors will have a good feel for the market and have a better understanding of the type of properties that you are after. This can also apply for property managers as well. I find a good property manager can be as useful if not more useful in determining the areas of a particular city or town that you should be investing in or staying away from. This can substantially reduce the amount of time you will need to put aside for researching the area yourself (although this is still very much a pre-requisite for any new area for your investments).

(2) How do you see the market currently?.

Use this is a gauge for their (a) knowledge of the current market conditions and (b) honesty. If they are OTT enthusiastic about how great the market is even though you know its not as dynamic as it was years ago I would question how honest they will be with the rest of their dealings with you.

(3) How long have you been in the industry as as a agent.?

There is no substitute for experience.

(4) Explain your requirements and then see how pro-active they are. It astounds me how some agents simply do not get back to you when you are a serious property investor in the market to buy. Perhaps they have had it too good for too long but I only use those agents that I can see are actively going to work and get back to me. I wouldn't worry about keeping to one agent either, not all properties are listed with all agencies so try to get agents that are spread across the main players.

(5) Ask for references or referrals if you need to.

You are building a team of specialists that could be with you for years so don't hesitate to ask for these either!

(6) Go with your gut feel. If you get to met them you will have a fairly good gut feel for what they are like.

[Ianacek]

I would recommend avoiding the Sole Agency system altogether. It might have been an advantage before the internet, but now all agents & buyers know about a listing as soon as it appears on realenz or open2view.

They often claim they have buyers already for your property - all they need is for you to lock yourself into a 3 month agency, they say.If the buyers are ready to go, why not simply sign a general agency & introduce them anyway?

A Sole Agency is only of benefit to the franchise owner. Their salespeople spend half their time fighting each other for Sole Agencies, leaving too little time to actually sell. Most leave the industry within 2 years. These salespeople are the expendable footsoldiers in the battle of the real estate brands & dashed vendor hopes are the collateral damage.

I would always use multilisting, with the right to sell yourself, if you feel you have some relevant skills & are willing to put a bit of time into educating yourself on a few simple procedures. Multilisting gives you control over the sales process, as well the possibility of saving some commission.

You should spend a lot of time accurately pricing the property. Consider getting a professional valuer. Real Estate agents CAN do the best job in valuing,because they have the up to the minute market sales information that no-one else has. However, they have a conflict of interest.

Also, pay for all the advertising yourself, whichever method you use,make a big marketing impact in the first 2 weeks, & withdraw the property from the market if it fails to sell within 1 month. Almost everyone in the market will have heard about your listing by then. If they haven't bought it, it will either be because it was overpriced or the market was too weak temporarily. You will only look increasingly desperate continuing to market it after 1 month.

Agents will happily hold Open Homes, but this is only a means to promote their brand image & get leads for other listings. They won't worry too much if your property remains unsold, so long as they can "condition" you to accept the eventual lower price. Bring it back in a month or 2; when a new "batch" of buyers has entered the market.

[revdev]

Ianacek,

I had the impression that duvetray was looking for advice from the buying side, rather than as a vendor.

Good advice tho!!

G

[Ianacek]

Revdev

Yes, you're right. For the buyer, I would recommend asking agents whether they are good at finding suitable properties for them, whether or not another agent holds the listing. If they only push their own Sole Agencies, are they not more interested in commissions than in matching buyers & sellers?

In Australia, the concept of the "buyer's agent" is better known. Essentially, the Sole Agency system ( to which most vendors & buyers subscribe ) acts to make the real estate market less efficient. Multilisting has worked well in New Zealand before, but was swamped by the franchises with their big marketing budgets.

The arrival of internet has started to restore the balance for both buyers & sellers.

[duvetray]

As an investor you need to work with the Agent on both sides of the deal so thanks for the vendor side advice too, but yeah primarily from the buying point of view i was looking for, cheers London Kiwi too a good read