WHAT YOU SHOULD KNOW WHEN A REAL
ESTATE AGENT KNOCKS ON YOUR DOOR

         Real Estate Agents by law in NSW, can not inspect your property with their prospective buyer until they have a signed agreement with you, the owner.  In order that they can attract your interest some Agents will use the ploy that “they have or could have someone interested in your property”  - don’t fall for this one – you are probably being conned and it could be very expensive – For You!!

·    If you have had your property listed with a Real Estate Agent/Agents you must cancel every Sales Agreement in writing if you intend to sell your property privately.

·    Were you aware every “AGENCY AGREEMENT” contains a clause in the Agent’s favour, guaranteeing the full commission for up to 120 days (4 months) after the owner notifies the Agent in writing that the period has expired.  (This is for any person introduced to the property during that period by the Agent.)

·    AGENCY AGREEMENTS Several types are available EXCLUSIVE means what it says.  SOLE can give exclusivity to that agent but also allows the owner to sell privately. OPEN is open to all comers.   IMPORTANT NOTE agency agreements are available in periods of 30 days, 90 days, or exceptionally 180 days – its your choice!

·         DE-REGULATION OF AGENTS FEES over a decade ago was meant to give consumers an opportunity to bargain with the Real Estate Agent for a fair commission - think about it !  SYDNEY AGENTS charge a flat fee of between 1.5% to 2.5% of the selling price which often includes advertising costs.  It’s easy to understand and has been around since Government deregulation of Agents fees nearly a decade ago.

·    MANY NORTH COAST AGENTS still use various scales of fees which would require the average person to be an Actuary to understand.  ie. (Sample only)  5% of the 1^st  $40,000;  4% of the next $50,000;  3% of the balance, etc.  Roughly these scales can translate to approximately a minimum of up to 4% of the asking price!  Plus advertising and Auction costs. Not bad if you can get  away with it, and they are!!

·    DID YOU KNOW AN AGENT CAN ACT FOR EITHER PARTY FOR A COMMISSION? IE. BUYER OR SELLER! So when a Real Estate Agent rings you to say he has someone interested in a property    like yours (having just seen it on our internet site or the Private Sale sign) you can say:  “Well that’s OK by me, provided you charge the Purchaser the Commission”.  This is legal and you don’t have to sign any agreements which bind you to paying the Agent exorbitant fees.

·         CONDITIONING:  Have you ever noticed that if you ask three (3) agents to give you a market estimation all three will vary considerably?  Very few Agents will give you an accurate figure because if they do it is nearly 100% certain you won’t give them your house for sale!  Home owner’s can’t be blamed for taking the best option and that is nearly always the highest price or market estimation provided by an Agent.  Conditioning begins to take place after you have signed a sole or exclusive agency and you become a “captive audience” much more likely to listen to advice from your agent to lower your price again and again until it finally “finds the Market”.  To be blunt they don’t care what price you initially ask for as long as they are in control of the process thereafter. 

·    AUCTIONS  If you are considering an auction, ask this pertinent question before signing an agreement “HOW MANY PROPERTIES WERE LISTED FOR YOUR LAST AUCTION, AND HOW MANY OF THOSE WERE SOLD UNDER THE HAMMER? The answer will influence your decision!

·    OPEN AGENCIES ARE AN ANATHEMA TO MOST REAL ESTATE AGENTS  Only because they lose direct control and have to compete with fellow agents for your business.
NOTE: They are totally legal and widely accepted in the Sydney market.
Make this form of agency your last resort when everything else appears to have failed. Give your property to as many agents as you can find in the phone book  rather than sign one single sole or exclusive agreement.

     Your Legal Obligations - click here

Think carefully about  signing any agreements, they will cost you thousands of $$$$ and a large slice of your freedom !

This information is intended for the clients of North Coast Private Property Sales and is not to be reproduced for any other purpose.