The Essential Questions To Ask Before Appointing Your Real Estate Agent
Choosing a real estate agent to sell your property is a daunting task, particularly if you have never sold a property before. Trying to determine which agent is right for you can be helped by asking a few key questions as below.
What is your experience in the industry?
In this industry, experience is crucial – but that doesn’t necessarily mean that the agent who has been around the longest is the best one for you. What you are looking for is someone who has had enough experience to handle all aspects of the sale, as well as the enthusiasm and motivation required to secure a buyer for you. What properties have you recently sold in the area, and do you have any buyers that missed out and might be interested in my property?
Agents will often have a type of property that they are best at selling, due to their location, experience and personal preferences. We would recommend an agent that has sold at least 5-6 properties similar to yours in the past twelve months. They should be in a similar suburb and be comparative in price and type. Real estate is a relationship and word-of-mouth business. Ask your agent if they have a database of clients that have missed out on previous sales – they might already have a few clients in mind that they can suggest your property to.
Be sure to ask the following to gauge their credibility:
- Would you be willing to provide the names and phone numbers of some clients you have recently sold houses for?
- Do you have similar properties for sale at the moment?
- How many properties have you sold in the last 12 months?
- Which properties have you sold in my area?
What marketing channels will you utilise to reach prospective buyers?
Advertising takes place in two forms:
- Traditional – newspapers, signboards, agency window display and brochures
- Digital – online advertising that reaches clients through their digital device such as online listings on agency and third party websites (Trade Me, Real Estate) and e-mail marketing/brochures. Depending on the type of property and its location, digital media options may be enough – have a look at what similar properties are doing in your area.
For agents across New Zealand, vendor paid advertising (fondly known as “VPA”) is ideal. The practice, however, varies by market, property type and agent. Will your agent put money on the table for any marketing costs or is it your responsibility? It pays to ﬁnd out to avoid any surprises. Also, it may be of use when it comes to negotiating commissions. If you bear all of the marketing outlays, the agent may be willing to reduce their rate.
Try asking these questions:
- Why do you believe these channels will be the most effective?
- Can I see some examples of your past marketing materials?
- How much money will I personally need to spend on advertising?
- Will I have to pay for the marketing if my home doesn’t sell?
What method would you recommend to sell my property?
There are several different types of campaigns your agent may recommend as follows:
- Auction – a sale, usually in public, by an auctioneer, in which property is sold to the highest bidder.
- EOI – Expressions of Interest – a deadline is set by which potential buyers submit a bid or offer of what they are prepared to pay.
- POA – Price on Application – property will be listed with a sale price of ‘POA’ so that vendors will need to contact agent to receive details.
- Tender – the selling of a property through seeking of written bids
- Sale – the process in which potential buyer’s negotiate with a Real Estate Agent to purchase your property.
Campaigns will be market dependant, for example, Auckland favours auctions where as Dunedin generally doesn’t. Another question worth asking is how they plan to arrange viewing of your property – is it via scheduled ‘open house’ times or by appointment only?
Try asking these questions:
- Why do you think this method would be most effective?
- How will the viewing of my property be arranged?
How much do you charge and what are your rates?
Needless to say, this is an important question. Remember that you’re not looking for the cheapest agent; you are interested in what is included in their fees. You need a good negotiator and value for money – a good agent will be able to conﬁdently justify their price. Commission levels vary widely depending on location and city, and there are other ways to negotiate the structure.
Real Estate Agent commission to give you a better understanding, and raise the following questions in your conversation:
- Would you be wiling to negotiate?
- How do I cancel our agreement?
- Would you provide a free appraisal of the property?
What selling price do you think I can achieve?
Prospective agents will give you a sale price they think they can achieve for your property. The most important question to ask is “What are you basing that on?” They should then support this ﬁgure with recent sales in your area of similar properties – both from their agency and others. Make sure they can support the suggested sale price with evidence – you don’t want to fall for the trap of securing the agent who simply says they can get the best price for you.
Here are some important follow-up questions to ask:
- What are you basing this ﬁgure on?
- What can I do to help sell my property quicker or for a higher price?
- Will you help me ﬁnd and recommend other relevant professionals? e.g. home stager, photographer, removal company, solicitor, plumber etc.
- What charges will I incur if the house doesn’t sell?
How long do you expect it will take you to sell my property and why?
In asking this question, you don’t expect the agent to give you an exact number of days that it will take to sell your property. You are looking for their understanding of the current market and the factors impacting your area, and how these will contribute to the selling process.
Here’s a good question that will test your prospective real estate agent’s grasp of the current market:
- What do you believe is the best selling point of my home?
Do you have details of references I can contact?
A good Real Estate Agent will happily supply you with a list of previous clients that they have dealt with. Even a new agent will be able to provide some sort of positive reference, for example from a past employer. Don’t be afraid to follow up with them to gain their feedback before deciding to appoint an agent.
Some examples of questions you may like to ask previous references are:
- What did you like about the agent?
- How long did the property take to sell?
- Was there anything you thought they could have done better?
- Did the agent secure the sale price you wanted to achieve?
How often can I expect updates/feedback from you?
Updates, feedback and good communication are cardinal to building a good relationship with your real estate agent. You need to know straight off the bat how frequently you will be contacted, who you will be speaking to, and the method of communication that will be used.
Be sure to raise the following questions:
- How frequently will I be receiving updates from you once my home is on the market?
- Who will be my primary contact during this time?
- What will be your primary method of communication? (phone, email, etc.)
What separates you from your competitors?
This question will allow the agent to demonstrate what stands them apart from their competition, both as an individual agent and as an agency.