For a start, there are a number of costs to consider – from advertising outlay to auctioneer’s fees, legal expenses and, of course, real estate agent commission fees.
Over the last few years, there’ve been a bunch of challengers to the traditional real estate model (The Property Market included). Many have come into the market with cut price real estate commission fees or fixed fees, designed to lure sellers with the promise of a ‘cheap’ commission.
The problem is that most of these agencies haven’t changed their business model enough to make the reduced fee viable; what this means is that while the vendor does pay less commission, they also get inferior service.
So, although it might be tempting to take that fixed fee option, you need to think long and hard about whether that approach will generate the best return on investment at the end of the day. To my mind there’s a big difference between ‘cheap’ and ‘value for money’.
Now, before you start thinking this is all a bit ‘pots and kettles’ , I’m happy to put it on record that The Property Market’s business model is significantly different to that of most other agencies.
We don’t have expensive high street offices, we don’t plaster ourselves on billboards and we compute in the cloud to keep our admin costs down. All of these things mean we can genuinely afford to charge a reduced standard commission of 2% plus GST. We also have a minimum fee of $12,000 plus GST to ensure we can maintain the level of service we promise.
Not only that, but our model is built to optimise customer satisfaction. We will only ever employ salaried salespeople, and this insures our team’s focus is on great service and getting the absolute top dollar for each property, not simply gunning for the fastest real estate commission fee.
I reckon the ultimate proof of our commitment to service is our FareShare commission structure.
Under FareShare, vendors pay no commission up to a set price – this is a figure that we mutually agree should be relatively easily achievable in the current market. Over and above that figure, The Property Market is remunerated at a percentage rate that explicitly incentivises us to get every last dollar out of would-be buyers. So, if we don’t get the price you deserve, you won’t pay over the odds but, if we work our tails off to deliver an exceptional sale price, everyone does well. You can learn more about the FareShare structure here.
What does all this mean if you’re thinking of selling your house?
The best piece of advice I can give is that the greatest return on investment is not necessarily generated by going with the cheapest commission. You need to think about whether the commission structure you choose will incentivise your real estate agent to get the absolute top dollar available for your property.
A note about private sales.
Considering selling your house yourself to save on real estate commission fees? A word of warning to you…
Putting aside the hassle of managing marketing, buyer enquiry, open homes and the negotiation process, selling your house privately is not always a cheaper option.
For a start, unless you’re a seasoned negotiator, it’s unlikely you’ll have the skill set necessary to extract top dollar from would-be buyers.
The other thing to consider is that the buyer’s bank may well, because it’s a private sale, require a registered valuation to be provided. If the valuer is conservative in their estimate, your sale price could take a significant hit.
About The Property Market
The Property Market is a full service real estate agency built to deliver a better experience for buyers and sellers. Think real estate, only reinvented.
• Our Ponsonby real estate agents operate within a 20 minute radius of Freemans Bay.
• Our real estate agent commission rates are innovative and competitive.
• Our focus on customer service is second-to-none.
Check out our latest listings and, if you’re thinking of selling your house, give us a call.