 What’s a fair fee when choosing an agent?
When choosing an estate agent, should the proposed fee be the most important factor in your decision?
Agents, like all businesspeople, devote their time where it’s most
likely to produce a reward. Because we’re paid a percentage of your sale
price, we don’t get paid if we don’t achieve a price you’re happy with.
What’s the norm?
On average, agents are paid 2.5% + GST of your sale price. But it’s not
unusual, particularly in areas where home prices are below national
averages, for agents to ask for a higher fee – especially if you’re not
paying for advertising.
Can I ask for a discount?
Some people like to ask for a lower fee and the agent’s response can be telling.
It’s reasonable to expect that an agent with a solid track record and
satisfied customers will explain why they believe the service they offer
is worth the price they are asking.
The agent’s response will show how effective they’re likely to be when a
buyer also asks for a discount on your asking price. An agent who
discounts their fee is likely to do exactly the same with your asking
price.
How do I judge value?
Firstly, ask the agents you interview for copies of testimonials from
previous clients. The testimonials & their content will give an
indication about their loyalty and ability to deliver on their
commitments.
Other things you could ask about are the number of days it takes them to
sell a house (on average), a list of properties they’ve sold in the
past six months (with a comparison of the initial asking price & the
final sale price), their average auction clearance rate and examples of
their advertising. Any agent claiming a 100% success rate is either
fibbing or very new to the industry.
You can also judge by the way an agent dresses, their manners, &
your feelings during the interview. If you feel comfortable, it’s likely
your agent’s buyer negotiations will be more successful.
What about my home’s price?
Be very concerned if one agent gives you a vastly higher opinion of your
home’s value. We sometimes hear homeowners say they’ve been ‘offered
more by another agent’. Remember, it’s not the agent who will be buying
your home. It’s the buyer & there’s a big difference.
The most expensive mistake you can make is to list with the most
‘optimistic’ agent at the lowest fee. You need a realistic opinion based
in fact.
The wrap up
Ultimately, fees are only part of the picture. An agent with a good
track record who is disciplined, enthusiastic & backed by quality
marketing will always achieve the best possible price. At the end of the
day, that’s what you should be aiming for.
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