Boy, do real estate agents get a bad rap. Consistently compared to used car salesmen, they are frequently criticised for inflating potential sales prices to secure a vendor’s business, only putting effort in when the property for sale will attract a good price (and therefore a commission for them) and fudging interest by potential buyers.
So I thought I’d find out how they really operate. It’s been a few years since I moved into my place, and given the escalation in property prices I thought it might be time to find out what the market thinks it’s worth.
I contacted three local real estate agencies to get them to give me a valuation on the property, all from big name firms. I stressed I wasn’t thinking of selling, I just wanted to find out what my place was worth.
The first agent was extremely well prepared: prompt, on time and boy, had she done her research. She was armed with a file full of all the most recent sales figures for every property on my street, as well as a separate report including all the most recent sales in the area and data like the median house price.
She also took trouble to build rapport – even showing me her cat photos – and let me know she was a local and her property was similar to mine, bought at around the same time.
The second agent was almost as well prepared, but focused more on giving me advice about how to maximise the value of the property over time. I had been debating the merits of adding a second storey or building a granny flat and this agent made a very cogent argument for why a granny flat, with the potential to generate revenue, would be a smarter option than adding a storey.
This is especially the case given the cost to add a second story would be far greater than converting the back garage to a granny flat. And there are no guarantees I would get my money back by going up.
He was super smart and subtle, however, letting me know about a one-bed place nearby that’s on the market that I could pickup for an investment commensurate with the one I would need to make to build an additional storey.
Although it’s not something I would consider right now, he certainly piqued my interest in buying another property down the track and obviously communicated the fact that he deals with investment properties, just in case that’s something I might be interested in in the future.
From a business perspective, he was by far the smartest of the three agents, employing tactics from which every small business could learn.
He gave me an indicative price, but promised to crunch some numbers and get back to me. However, at time of writing he had not provided this information. Lack of follow up was the only black mark against his name.
The third agent, the one who sold me the property, was as professional as the first two. She provided me with information about recent sales and local property prices. She was also able to justify her valuation by pointing to recent sales of very similar properties.
What was interesting was that all three came up with the same valuation.
So on balance, who would I go with? Their fees and charges were comparable, although the second agent was slightly pricier. But I can understand why given the added value he provided.
Choosing between them is hard, given they were all extremely professional, but I would probably go with the second agent given he displayed strong business acumen, which would hopefully translate to the sale of the property. This choice is despite the fact I probably had better rapport with agents number one and three.
Ultimately, selling property is a commercial decision and for me, I’d prefer to go with the agent that displayed the best business sense.
And despite the reputation real estate agents earn, I felt all three were genuine and trustworthy