IS THE AGENT WORTH HIS CORN?
For anyone selling a property the amount of commission's to be paid to the agent must always be an important consideration. It is, after all, a substantial amount of money. So what services should the seller expect to receive in return?
ACCURATE VALUATION
Unfortunately not all agents can be experts. It takes years to gain sufficient experience to be able to value all types of property accurately. There are, of course, data bases that agents can access which record the selling price and brief details of all properties sold in a given area but since no two properties are ever exactly the same such comparative analysis is helpful but far from definitive. Only with the benefit of considerable local knowledge, extensive sales experience and a keen awareness of changing market conditions will your agent be able to put these figures into context and arrive at the correct selling price for your home. It helps if your agent is qualified but he MUST be experienced!
EFFECTIVE MARKETING
There are a number of options open to agents when deciding which medium to use in order to market your home effectively. The cheapest, quickest and simplest is the traditional FOR SALE board and in a brisk market it can be very effective. Show Days, although not popular on the South Coast , can also prove effective in exposing the property to potential buyers. For the most part, however, print is the medium of choice and most agencies use the property pages of local newspapers. Surprisingly this is more expensive than one might suppose and not always successful. In a seasonal market such as the South Coast , it may be unproductive to advertise expensive homes out of season. Advertising in the local press does, however, serve a useful function by indicating to potential sellers and purchasers which agencies are active in the area.
The more sophisticated agencies also use national newspapers, trade magazines, specialist publications such as Country Life, The Financial Mail, various glossy airline and business magazines and TV to reach their target markets. These are, however, extremely costly and often require a lead time of up to two months before publication. This form of advertising is therefore best suited to marketing expensive properties which are normally held on long sole mandate.
The newest and the fastest growing advertising medium is the World Wide Web and every agent worth his salt should now have a dedicated web site. While setting up such a site is relatively simple, it is difficult, time consuming and costly to create a site sufficiently attractive to gain the attention of the major international search engines and that's increasingly where sophisticated up-country and overseas clients now look first. But with a really effective web site, even the smallest agency has a global reach!
Whatever the medium of choice, effective advertising requires the expenditure of much time, effort and money. However, it's an undeniable fact that good photography and creative copy writing generate greater client interest and achieve better results. It helps if your agent is literate but he MUST be innovative!
RESPONSIBLE SELLING
This is where you tell the men from the boys! Your agent must be experienced enough and tough enough to qualify prospective purchasers in terms of both their motivation and their ability to complete the purchase timeously. This makes it necessary for him to ask some very searching and sometimes even embarrassing questions. And he has to press for detailed answers - particularly since the introduction of the Financial Intelligence Centre Act and recent new SARS regulations. But among the most important questions any agent can ask are: - Where is the money coming from? How long will that take? Can you put up a reasonable deposit? and Have you made provision for the costs?
Prospective purchasers who have fallen madly in love with a property are often woolly about how they intend to pay for it! From the very beginning there should be absolute clarity on whether and how the purchase price can be met. Are the necessary funds immediately available in the form of cash or will they come from, say, a local or overseas deposit account, a sale of shares or assets or the sale of the purchaser's existing property? Each of these may be subject to unforeseen delay and will therefore dictate different timescales. There are of course many other questions that will require satisfactory answers but it is far better to screen out a doubtful buyer at this stage than on the day the removal van is due!
Unfortunately a 100% cash buyer is a fairly rare beast but cash means just that cash. A bond, however credit worthy the buyer may seem, is not cash and there can be many problems and delays along the way if the agent fails to differentiate between the two. Even in cases where the client has a certificate from a bank pre-qualifying him for a bond equal to the purchase price that isn't necessarily a guarantee of his ability to perform. The property he finally intends to buy may not come up to valuation or it may be a commercial property, for example a B&B, for which it may be difficult to arrange a high % bond. The business or the area may be considered high risk from the bank's point of view and there is always the danger that the purchaser's financial position may have deteriorated, or the bank's interest rate increased, since a loan was agreed in principle. If the bank should now require the purchaser to put up a larger share of the equity before granting the promised bond, will he be able to find that additional amount plus the substantial costs?
If the sale is conditional upon the sale of the purchaser's existing home, is the price of that home reasonable and what time scale is envisaged? At this point your agent should be in touch with your purchaser's agent concerning both the saleability and expected timescale for the transfer of your purchaser's property.
Since this is where the money for the purchase is coming from it is essential for your agent to keep in close touch until that sale is successfully concluded. The agent owes a duty to his client to follow up at every stage of the transaction and to supervise the progress of the sale until transfer has been effected and the money paid out. Once a property is SOLD it should stay sold! It helps if your agent is clairvoyant but he MUST be thorough!
GETTING IT RIGHT !
But, hey, don't be too despondent. If the agent has done his homework conscientiously, got all the right answers, sorted out the timescale and drawn a water-tight Agreement, there should be very little possibility of the sale falling through. But as everyone knows, the first law of property is that - everything takes longer than expected - and the second is Murphy's Law of Property if something can go wrong, it will!
SEE OUR PROPERTY POINTERS
To
view PURCHASING A PROPERTY IN SOUTH AFRICA
To view TAXES, FEES AND
COSTS
To view GET THE BEST PRICE FOR
YOUR PROPERTY!
To view MAKE YOUR PROPERTY ATTRACTIVE!
To view THE PEOPLE YOU’LL
MEET
To view I’VE SIGNED –
NOW WHAT?
To view IS THE AGENT WORTH HIS
CORN?
To view LEARN AGENTSPEAK
To view IS SOUTH AFRICA A BUY
?
|
CLICK
HERE
CLICK HERE
CLICK HERE
CLICK
HERE
CLICK HERE
CLICK HERE
CLICK HERE
CLICK
HERE
CLICK
HERE
|
SEE OUR PROPERTY PORTFOLIO
© denton-miller estates 2001
