5 ways estate agents earn their money
MAIN IMAGE: Craig Hutchison, CEO of Engel & Völkers Southern Africa.
Times are tough and with an ever-widening range of cheaper digital options continually becoming available to people who want to buy or sell a house, a commission-based estate agent must be ready to sell convincingly the services they can offer. Craig Hutchison, CEO of Engel & Völkers Southern Africa, lists five ways that professional estate agents earn their fee.
Hutchison begins by noting that there is more to selling a home than meets the eye. “As with any other service, having a professional, experienced agent and brand at your disposal to take calls, manage paperwork, handle the negotiations and processes, will ensure a smooth sale. This will ultimately save the client considerable time, effort and money. This does however come at a fee, and it is important to know what the client is paying for,” he says.
Hutchison lists the following ways to illustrate some of the things that a professional estate agent does when assisting a client to buy or sell a property.
When a client is selling his home, it is not the owner who will be setting the selling price; it’s the market. Whatever the market is prepared to pay for a home is what it will sell for. A knowledgeable agent will do a comprehensive market analysis of the property taking into account detailed suburb reports as well as their knowledge of the area of what is on the market and what has sold recently. After considering all factors above as well as where the suburb is heading, thinking like a buyer, seller and bank valuator will come to a market-related selling price for the property. This ensures the seller gets the best possible price under prevailing market conditions.
The average time which a property is on the market for, is 3 months, thereafter is starts to appear as stale stock. Agents devote large amounts of their time to finding future clients and building a reputation. In fact, a large share of real estate sales is successful as the result of the agent and agencies client database that has been built up over many years. The database is a result of many years spent on activities and marketing prior to the client’s home being listed.
Agent fees are made up out of time, including driving to appointments, time spent on the phone, meeting prospective buyers, promoting, advertising and showing the property and canvassing and distributing marketing material. Professional agents will also embark on continuous training programs to stay up to date with any new legislation requirements. The general public is often unaware of the expertise, time and effort and all the ‘to-do’ items that is put into selling real estate.
There are many negotiating factors for the agents to handle, aspects such as the listing price, financing, terms, date of occupation and the inclusion or exclusion of repairs, furnishings or equipment. Professionally trained agents are expert negotiators and will always attempt to negotiate the best deal. They are trained to identify the personalities of buyers and sellers and how best to negotiate the deal to ensure the successful transaction.
Education and experience
Professional agents have years of experience, knowledge and support behind them and without a doubt, know their areas and how to do their job well. They have already identified any potential problems and solutions with the property in advance and understand the seller’s mind-set, they know the ins and outs and have the expertise, and negotiating skills needed to provide reassurance to the buyers, that they are making the right decision.
As many property professionals have confirmed, a professional estate agent who stays on top of his game need not fear that he will go the way of the milkman or the switchboard operator – there will always be a need for his services. Editor.
Did you find this article useful? You are welcome to make suggestions or requests for articles that will assist you in becoming a better property professional – just email firstname.lastname@example.org.