Don’t pick the cheapest agent to sell your property – here’s why

According to Gil King, CEO of the Real Estate Institute of Victoria, the process of deciding an agent begins beforehand, with sellers doing some research themselves.

“Knowing which agents and agencies are active in your area is important as local agents can draw on their database of interested property seekers, in particular buyers who may have missed out on a similar home in the same town or suburb,” Mr King said.

“It’s also a good idea to research homes for sale in your neighbourhood – and how much they are selling for. It’s advisable for potential sellers to attend a couple of local open for inspections as this will allow you to see how the different agents conduct themselves as well as their knowledge of the local market.”

Then, after doing broad research for the area, sellers then should seek to have their property appraised by at least three different sales agents.

“Agents appraising your home will use comparable sales to provide you with an estimated selling price for your home in the current market,” Mr King said.

“An appraisal also provides an opportunity for you to ask agents what services they provide, the strategy behind their marketing and advertising campaign and what their commission fees are.”

When looking into commission fees, Mr King said that these generally vary, but can range between 1.5 to 2.5 per cent of the sales price. Another aspect to consider is fixed fee agents that offer a flat rate for selling a property, as opposed to a commission.

However, Mr King warns to not let commission make up the bulk of your decision making, as while you may want to find an agent who asks for the smallest possible rate, as he says “the cheapest agent may not necessarily be the best agent to do this”.

“Remember, it’s a competitive market and sellers are in a strong position to negotiate commission fees with their preferred agent,” Mr King said.

“There are a number of agent comparison sites in the market, however, it’s important to bear in mind that these services are not free and will often obtain a share of the agent’s commission.”

Mr King also warned against attempting to sell a property by yourself, as he views the act of negotiating a sale as “a skill honed with training and experience and is an area where a licensed agent can add significant value”.

“An experienced agent can not only advise on the initial listing price but, importantly, negotiate the final sale process and price with one or more interested buyers, achieving the best possible outcome for your most valuable asset,” he said.

“Trying to sell your house ‘on the cheap’ can cost you significantly in the long run.”