Once, twice, a million times
If, like my family, you have been looking to buy any sort of real estate in New South Wales recently, you will almost certainly have come across on-line ads requiring purchasers to contact the agent for a price guide. Indeed, the properties advertised with a price guide are a truly rare commodity. As a real estate agent, having just sold our family home, the shoe is now very much on the other foot. When this annoying (to say the least) tactic is undoubtedly very unpopular among buyers and there is a proven attrition rate, you must ask yourself why do agents actually do it?
It is a trend that surfaces as a popular option when the property market is buoyant, buyers are plentiful and competition stiff. At these times, in the agent’s defense, the market can be moving swiftly, so much so that no sooner have you converged on a price that you believe is a realistic estimate, then it is out-of-date. Equally, there are some (but not very many) properties that have such truly unique features or attributes that pricing them can be a little tricky – these are properties that will tend to be sold through an Expressions Of Interest (EOI) campaign. In both these cases, it can be argued, that a price discussion is a more appropriate way of handling price, rather than a disclosed price which may prove to be inaccurate in the long run.
Now, here is an opportunity to get drawn into a number of other related “issues”, such as method of sale, under-quoting to buyers (bait advertising) over-quoting to vendors (buying listings), comparable evidence selection and the list goes on. However, this is intended as a brief article and not a property version of “War and Peace”, as I sometimes think the public perceive real estate to be, so I will try to resist that temptation.
Ain’t No Sunshine
If not putting up a price guide can be justified in certain situations, it doesn’t mean that it can be justified in all situations. Unfortunately, for our Queensland counterparts, they have no choice but to remain tight-lipped. There, if a property does not have an asking price, and is to be sold at auction or through EOI, then representative agents in the Sunshine State are prohibited from providing any guidance whatsoever. This is on the back of legislation a few years ago which tried to deal with the problem of widespread misquoting and to stamp it out. Whist I don’t particularly care for having to contact NSW agents for a price guide (however accurate or inaccurate that may ultimately prove to be), I certainly don’t envy buyers in Queensland, who are expected to rely on their own research to determine value or the possible selling range.
Of course, those long-suffering purchasers who have made more than a few price guide enquiries and have done as instructed, to “Contact Agent”, are likely to have received a mixed response, or no response at all on occasions. These range from the “helpful” – “Thank you for your enquiry . . . . . . we are expecting this property to sell in the range from X to Y” to the downright unhelpful, this is one I had the other day: “The property is scheduled to go to Auction on . . . . and we are not currently quoting a price guide. If you would like to be kept informed on the property, please let us know.” The audacity! Or this one, a real corker: “This property is going to Auction on . . . . . . . . We have been instructed not to influence the market with a price guide as such however, the vendors are extremely motivated and the property must be sold.” I wonder if the vendors knew they were as motivated as the agent would have you believe. Also, though I may be a little wet behind the ears, only having been a property professional for 35 plus years, but I surely don’t understand the response at all – I thought it was exactly the agent’s job, through his/her professionalism, negotiation, communication, and marketing skills, to “influence the market” otherwise, as an agent, you are simply a transactional agent and not adding value.
Trust Me, I’m A Real Estate Agent
I have to say that it is little wonder that so many of the public (most of whom will engage with the real estate industry at multiple points through their lives) have so much disdain for a lot of (not all) residential selling agents in NSW. Many agents will tell you (and hide behind) the somewhat mythical notion that they’re acting in their clients (read vendors’) best interest, something in fact embodied in the legislation. However, since when does this encompass lack of transparency, treating buyers as second class citizens (they still owe a duty of care and dare I say respect towards buyers), providing deliberately misleading price guides (my default rule of thumb is to generally add 10%-20%, sometimes 30% – which I regret is painting all agents with the same brush of untrustworthiness) and embarking on campaigns that are clearly more suited to the agent rather than the vendors (or buyers for that matter). I’ll give you a clue, the “since when” is geared to when the property market is “hot” and the agent thinks he can afford to lose a few buyers in the process of getting the property sold, I am not sure vendors would agree that a needless attrition of buyers for their property is doing them a service.
Nothing To See Here!
And now, a shout out to our Victorian counterparts, as we have made a number of purchase enquiries interstate too! The legislation in Victoria requires agents to have and to upload on all internet advertising a “Statement of Information”. This sets out, the median price in the vicinity in which the property is for sale, its indicative selling price (either a single price or price range) and details of three recent comparable sales in the area. So, if the property is being marked with a price tag, it is going to auction, is being sold through EOI or it has the inevitable “contact agent”, you don’t actually have to contact the agent for a price guide, as the price indication is there for all to see. This has to be the Gold Star Standard for transparency. How refreshing it is to deal with agents who don’t feel the need to engage in smoke and mirrors tactics to achieve an outcome, where presumable there is little room for misleading conduct and a happier process.
Power To The People
Finally, with signs that the market is cooling down in NSW, indications also of a more helpful and respectful approach by agents to buyers, acknowledging perhaps that buyers are now a key player that cannot simply be dismissed quite as quickly. After all, it takes a buyer and seller to come together with intent if the agent is to receive their commission. If the market predictions are correct, buyers should shortly be able to look forward to upfront price guides and agents demonstrating a new willingness to assist them. Wow, it’s not a lot to expect, is it?
What’s your experience, am I being a little harsh on my own industry team mates here, or doesn’t this account not go far enough? I’d love to get some feedback.