ARE YOU SELLING OR DREAMING?

Currently I am reading the book "REAL ESTATE MISTAKES" written by NEIL JENMAN, an Australian Real Estate consumer advocate and I came across this headline, "HOW TO KNOW THE TRUE VALUE OF YOUR HOME".

Pricing your home incorrectly is one of the key reasons of frustration for every home seller that hasn't sold.

This extract from "REAL ESTATE MISTAKES" will arm you with some excellent information before you place your home on the market.

HOW TO KNOW THE TRUE VALUE OF YOUR HOME!

There is one excellent way to know what your home is truly worth: Before you call an agent, call a valuer. 

A valuer is not biased about your home because a valuer has no financial interest in the value. You are naturally biased because you want the best price. The agents are biased because they want to be selected as your agent. And the buyers are biased because they want to buy for the best price. Valuers are the only people who are not biased - they get paid no matter how much your home is worth.

Valuers are highly qualified, their;s is a specialised field. But most important of all - from an accuracy point - a valuer can be legally liable for a mistake. Valuers are careful.

You too should be careful. You should have an independent valuer - not one who works in a local real estate office - inspect your home before you call an agent. 

A valuation is a great investment for a home worth hundreds of thousands of dollars. It gives you powerful knowledge. It enables you to make plans based on facts not opinions of people who have a financial interest in the sale of your home. Every home should be valued before being sold. 

Once you have a valuation - and you are aware of all the mistakes you must avoid - you are ready to select your agent.

I hope you enjoyed this extract from the book "REAL ESTATE MISTAKES". If you are selling your property this book is well worth a read, before you place your home on the market.

If you would like some further information about SELLING / BUYING / RENTING you can contact me on 5495 7777 or via our website at www.marsellospike.com.au.

Have a wonderful day - Frank Pike

QUOTE THE PRICE YOU WANT, NOT A 'BAIT' PRICE - ARTICLE 9 OF 9

It sounds good in theory – quote a low price to ‘lure’ purchasers in, and then work to get the price up from there.

But why do NO negotiation EXPERTS favour this method?

Bait prices trap sellers as well as buyers.

Never allow an agent to use a low false price to ‘bait’ buyers. If you use a price range or guide or a ‘by negotiation’ strategy, you are encouraging buyers to offer you less. Your ‘bait’ price will ‘hook’ you more than the buyers!

Sure, a lower ‘bait’ price may attract more buyers, but it attracts the wrong buyers. The lowest price the buyers see will become the highest price they want to pay.

And never tell anyone – including your agent – the lowest price you will accept because that too can quickly become the highest price you will get.

Learn to Love Early Buyers

High prices often come early. The only problem with buyers who make good offers early in the marketing campaign is that their offers do not look so good when compared with the first, and current, asking price – which is always higher than the true market price.

American sales trainer, David Knox, said “Sellers do not come down FROM Market Price; sellers come down TO Market Price”

Ask your agent to tell you about the Endowment Effect, which was discovered by Harvard University professor, Dr Max Bazerman. The Endowment Effect explains why sellers often expect more than their properties are worth, but this expectation should not stop you from getting the highest price.

Your agent should give you an accurate estimate of the likely selling price of your property. Although this figure is likely to be less than you expected, the agent’s likely selling price range should be the TRUTH.

All negotiation experts say that if you want to get a high price you should start high.

We agree with this, but this creates a problem with early offers which, as was previously said, are often the highest.

The problem with early offers is that, although they are often the highest offers, they…….

Look terrible when compared with a high first starting price.

Low prices often come late, so be careful – the buyers you reject when your property is first placed for sale may be the buyers prepared to pay the best price.

The longer your property stays on the market, the number of buyers for it usually gets lower, not higher. And your price will often get lower too.

So treat early offers with respect.

For more information on selling your property in today's market please call Frank Pike at Marsellos Pike Real Estate on 5495 7777. 

TO OPEN OR NOT TO OPEN? - ARTICLE 8 OF 9

As mentioned earlier, open inspections can make a property look smaller.

They also leave you exposed to the risk of ‘games’ being played by prospective purchasers. There have been cases where a purchaser, who was interested in a property, spoke loudly and negatively about it during the open inspection in the hope of discouraging other purchasers.

Whether this tactic succeeded or not is irrelevant – why risk exposure to such tactics.

There have been cases of theft during open inspections and opinion is divided as to whether the home owner is covered by insurance in such circumstances – after all, the thief was invited into the home.

From a professional selling perspective, only people who are qualified to purchase should have the right to inspect a property, and they should be allowed to do so at a time most suitable to them and to the home sellers, not the agent.

Although open inspections are more convenient for the agent, who only has to serve each seller for one hour per week, some agents believe in an old-fashioned concept call SERVICE.

If your agent is happy to offer you, and your potential purchases, better service by taking buyers through one at a time, you may find this service leads to a higher price for you.

Should We Have A Sign?

The buyers who are most likely to pay the highest price will specifically want your location. No sign can mean no sale.

A sign attracts thee buyers. It is your 24 hour salesperson. It is often your best salesperson.

Be careful, however. Some people will knock on your door. Insist they call your agent. Trying to negotiate yourself could cost you thousands of dollars.

For Sale Signs also attract other agents, those who are too lazy to find their own properties for sale, and those who are unscrupulous.

If other agents approach you, send them packing no matter how many times they tell you they have a great buyer.

These agents are the worst in the industry. If they will “steal” other agents’ clients they will almost certainly deceive you. Do not speak to sleazy buyers or agents who approach you without being first introduced by your listing agent. 

 “Open for Buyers” means an Open Agency

Closed offices lose buyers. Make sure the agency you choose is open seven days.

Many agents work ‘nine to five’ and close on Saturday afternoons and all day on Sundays.

While this may be acceptable for a bank, you need an agent who is available to buyers when they want to go looking.

Weekends are especially important. This is when most buyers have the time for home searching.

You never know when the perfect buyer will come along. And that buyer will buy from the agent who is open. The best agents offer a 7 day service. They are always prepared to work on your behalf.

For more information on selling your property in today's market please call Frank Pike at Marsellos Pike Real Estate on 5495 7777.  

LIST EXCLUSIVELY - ARTICLE 7 OF 9

The more agents you employ the greater your chances of getting a lower price.

Do no place your property for sale with several agents. You may think this will increase your chance of finding a buyer, but it decreases your chance of getting the highest price.

All of those agents will be in a hurry to sell your property before someone else sells it. The sale will be most important. The price will be forgotten.

Buyers shop around. They will use the agent who can obtain your property for the lowest price.

Test this yourself. When you see one property with several agents, call them all and ask this question: “What is the lowest price I can get this for?” You will be told different prices.

The saying goes that a chain is only as strong as its weakest link.

It is hard enough when buyers shop around for properties, but do you also want them shopping around for the weakest agent too?

Is There Anything Better Than Auction?

Many agents will say “No!” but then again, they’re trained to say that.

There can be no doubt that auctions often get a high price, but can they guarantee to get the highest price?

Buyers Agents represent purchasers, and not home sellers. A Buyers Agent assists purchasers to buy cheaply. 

This is what one Buyers Agent ** has to say about auctions:

“I attend many auctions and bid for properties on behalf of my clients. At the majority of the auctions where we were successful, we had “money left on the table” – that is, we spent less than our authorised limits” **

** Patrick Bright – Buyers Agent & Author of “The insider’s Guide to Saving Thousands at Auction”

No Negotiation expert favours allowing competing parties in a negotiation to hear what another party has offered, yet this is what auction does.

A better alternative to auction is to negotiate privately using the Buyers’ Price Declaration.

Based upon an idea developed by economist the late William Vickery – one of several ideas that earned him the Nobel Prize for Economics - this negotiation tool is demonstrably better than auction for sellers, buyers, and agents.

With the Buyers’ Price Declaration, no competing party is privy to another party’s offer. This means that each buyer must offer his or her highest price without being influenced by what somebody else may have offered.

Ask your agent about negotiation with a Buyers’ Price Declaration. If he or she still insists on auction, insist upon a price guarantee.  

Hire a Specialist

 If you follow the advice in this booklet you will seek out a professional salesperson – a trained negotiator – who uses the Buyers’ Price Declaration as a means to obtain the highest possible price for you.

You should understand, however, that few agents know this tool and understand how to use it.

This means that if you tell an “auction specialist” (usually recognised by the fact that the salesperson “pushes” auction to you) that you do not want to auction and then force that person to handle your sale by Private Treaty, you will have working for you a salesperson that is out of his or her depth.

A Private Treaty specialist seldom does auctions. He or she is a specialist in negotiating high prices face to face.

But just because your agent claims to be a Private Treaty specialist this does not automatically mean that he or she knows and uses the Buyers’ Price Declaration.

Ask questions. Discover whether your preferred choice of agent understands the principles of negotiation and the Buyers Price Declaration.

Weekly Price Review

Price is a major factor in marketing and it is important that you and your agent get it right.

Since all negotiation experts say that if you want to get the highest price you should start high and then come down until the right buyer is found, it stands to reason that price is a very important factor in effective marketing.

Every week you and your agent should meet to discuss:

• The weeks marketing – what has been done, and what enquiry did it generate?
• Discuss individual enquiries and what they had to say about the property. This includes those who talked with the agent about the property even if the discussion did not result in an inspection.
• Weekly Price Review – is the current price attracting interest? Have any offers been made? At what price should the property be offered in the coming week?

Try not to get too “hung up” on price. In marketing, price is like bait is to fishermen – if one type of bait isn’t working, change the ‘bait”

For more information on selling your property in today's market please call Frank Pike at Marsellos Pike Real Estate on 5495 7777. 

CHOOSE SKILL, NOT OPINIONS - ARTICLE 6 OF 9

Some agents tell lies to win your business.

Be careful that you do not choose the agent who tells you the biggest lie about how much ‘you will get’ for your property. This is called ‘buying the business’.

Unless the agent is prepared to buy your property, his or her opinion is irrelevant.

If you choose agents based on the selling price they quote you – their opinions – you may be badly disappointed, and may even wind up in financial difficulty.

If you suspect that an agent is attempting to buy you business with an inflated sale price estimate, insist they give you their estimate in writing.

Insist, also, that they charge you nothing if they sell for less than the price they estimated. This will indentify the agents who are enticing you with false quotes.

Choose Skill, Not the Cheapest

Cheap agents get cheap prices. Be careful choosing an agent based purely on their fees.

If agents give their own money away what do you think they will do with yours?

It may be better to pay an extra one per cent for a selling fee than to receive ten per cent less on your selling price.

Good negotiators rarely give big discounts on their fees. If they get you the best market price, they are worth a fair fee.

Choose NEGOTIATION Skill!

If you have spent a lot of time interviewing real estate agents, you may have noticed that they talk endlessly about the advertising they do, but few talk about the one thing that is more important to you – their negotiation skill.

Poor negotiators can cost you a lot of money.

Negotiation skills are vital to ensuring you get the highest possible price. A good negotiator can achieve up to an extra ten per cent on your selling price. This can mean thousands of dollars.

If you have an attractive property you don’t need a salesperson as much as you need a negotiator.

Ask your agent to PROVE his or her negotiation ability to you. Most won’t be able to do so. These are the agents you should avoid.

Choose an Agent That Has Buyers Waiting

The best agents keep detailed records of buyers.

Most agents get dozens of enquiries from buyers each month. Some get hundreds. But most don’t keep records of these people – names, enquiry details, email addresses and phone numbers.

Usually these agents do not feel the need because their home sellers pay for the advertising.

When agents keep records of genuine buyers, there is less need for advertising.

Insist on an agent who keeps detailed and accurate records of genuine buyers. One of these buyers may be perfect for your property.

DON'T AGREE TO PAY ADVERTISING COSTS - ARTICLE 5 OF 9

The way typical real estate agents advertise is a waste of money. Make sure it is not your money.
Many agents advertise to promote themselves, and not your property. In the past twenty years, real estate advertising has increased as much as twenty times. In most areas, the number of sales being made today is the same as twenty years ago.

Home sellers are often pressured to pay thousands of dollars for advertising. This is a needless expense because very few properties are ever sold because of advertising.

Be Reasonable About Advertising

Advertising will rarely sell your property. Too often sellers make the mistake of demanding advertising for their properties.

The previous hint for selecting an agent advised you to not pay advertising costs, but this does not mean that you should make unreasonable demands upon your agent for needless advertising. Be reasonable about advertising.

Buyers who want to buy in your area know the area. It is the area that attracts them, not advertising. It is a waste of time, money and energy to place advertisements in publications that reach thousands of people who will not buy in your area.

The media your agent chooses to expose your property in is also important. Many buyers are now Generations X and Y, and these people do not read newspapers nearly as much as do ‘baby boomers’. Agents who rely on newspaper advertising are quickly becoming old fashioned.

Your agent needs to be an expert in Internet Marketing, and should not necessarily “follow the crowd” by advertising heavily on third-party websites, either:

Here is what your agent should be doing to find a buyer for you:

-         Your agents office should be open 7 days

-         Your agent should be sending email Home Alerts to thousands of buyers each week

-         Your agent should have large numbers of signs in the area

-         Your agent should be an expert at directing enquiry to his or her agency’s website.

This will bring the best buyers to your agent and your agent will then qualify the buyers and bring the right ones to your property. That’s how most properties are sold.

If your property is not selling there are usually only two reasons: the agent is incompetent or the price is too high.

If you keep advertising your property, people may start wondering what is wrong with it.  

CHOOSING & WORKING WITH AN AGENT - ARTICLE 4 OF 9

Choosing the right agent is crucial if you want to get the highest price for your property with the least amount of stress.

Buyers have a choice – your home or someone else’s.

Your agent should be skilled, selling the positives of your property and, when necessary, selling the negatives of properties that are listed with other agents.

This does not mean your agent should mislead people. It means that your agent works for you and not for the other home sellers or their agents.

Your Reason

Be sure your reason for selling is confidential. No-one, other than the agent you trust, should know why you want to sell.

If the buyers know you have a pressing reason for selling, this could be used against you.

It is enough for buyers to know only that you want to sell. The reason is your business. Revealing it could weaken your position when you receive an offer.

The best agents will tell you how to give your property that special feeling that wins the hearts of buyers.

With the right agent, and with your property looking its best, you will always get the highest price.

The greatest problem facing home sellers is lack of information. Some people only sell a property once or twice in their lives. Even those who sell more often rarely have the experience or the information to know how to get the best price with the least risk.

Following are some things you should consider when selecting a real estate agent.  You will, it is hoped, notice that in none of these ways is it suggested that you select an agent based on who charges the lowest fee, or on who quotes the highest selling price to you...

This is the most dangerous ways to select a real estate agent.

Insist on a Guarantee

The best advice to any person thinking of selling a property is to insist on an iron-clad service guarantee – one that gives you the opportunity to terminate the agent’s services WITHOUT PENALTY if you are not receiving the service your agent promised you at the listing presentation

All agents will ask you to sign an agreement before you sell your property. But remember that you are being asked to sign their agreement. Many sellers bitterly regret signing that agreement with the agent.

The best agents will gladly GUARANTEE their services.

Avoid agents who do not offer a service guarantee.

Find an Agent you trust

If you don’t trust the agent, don’t hire the agent. A major ingredient in any relationship, business or personal is trust.

Before you choose your agent, ask many questions, check references, ask for a guarantee, test their negotiating skills and ask yourself a BIG question: Do I feel comfortable with this person handling the sale of (possibly) my greatest financial asset?

If your answer is “no”, do not hire the agent.

Once you decide on an agent, give the agent your trust and confidence. Do not interfere.

Allow the agent to make decisions and get on with the job finding the right buyer for your property.

If the agent later loses your trust, provided that you insisted he or she sign a guarantee, you can always dismiss the agent and find one you can trust.

The best agents are worthy of your trust. They won’t let you down.