Why Use A Full Service Agent?

Private sales of homes have always been around, we have all heard stories of owners who have supposedly sold their own home and avoided paying an agent commission. The big question is – have they really saved money, or have they actually cost themselves money as well as the time and hassle involved?

When selling what is most likely your biggest asset you want to be sure you get the very best price, and this is exactly what a full service agent is trained to do and they have the tools for the job.

Some of the factors that help him do his job are:

1. He works with property and people every day, he knows the market, what is in demand and what is not.

2. He has access to the latest accurate sales data, he knows what other properties actually sold for, this is often very different from what they were advertised for or what the owner may tell you he sold it for in order to save his pride.

3. He has access to this magazine and its sister website, the leader in the Illawarra as well as realestate.com, the largest property internet site in the country, both of which do not accept private ads. This alone dramatically cuts down a private sellers’ ability to connect with a potential purchaser who will probably never know their house was for sale.

4. He is a trained negotiator, he can be the middle man that gives you advice and time to think so you get the best deal, it is very hard to do face to face with a buyer who may well be more skilled at negotiating than yourself.

5. An agent keeps a data base of qualified clients that he can tap into immediately, people who he knows are genuinely looking for homes, not just ‘tyre-kickers’.

6. He looks after the sale once it is negotiated through until settlement. There are often 2, 3 or more issues that come up after a sale is made that need to be resolved and may require further negotiation.

The peace of mind that these factors bring to people who engage a full service agent can be compared to the pitfalls a private seller will face:

1. Firstly it is pricing the property correctly. Sure people can check the internet and compare it against what you think are similar properties, but they have not been inside those homes to be able to properly compare them to their own. They also don’t know what they actually sold for, unlike an agent who has the data. Overpricing can be just as damaging to a potential sale as underpricing.

2. Their avenues of advertising are limited and expensive, they don’t get access to the major internet sites, the dominant publication and will potentially miss their “dream buyer” because they never knew their home was for sale.

3. The time it takes to show prospective purchasers through, they often want to come through while you may be at work which may be inconvenient for you or on the weekends when you have other plans.

4. If buyers know you are selling privately usually the first thing they want to do is reduce their offer by the amount of the commission because they know you are saving it, they want the benefit of the saving you are supposedly making.

Think of it like this, if you had to go to court would you represent yourself or get a good solicitor? Even solicitors rarely represent themselves, they know the value of good advice from a third party. They have a saying, “a solicitor who represents themselves has a fool for a client”. The same goes for selling property, a good agent will usually negotiate enough extra to cover their fee plus save you all the hassle.

Why would you put yourself through it and usually cost yourself money as well. Get a professional and have them earn their fee.

What's Ahead For 2012...

The new year has arrived and as usual it is full of predictions, so I thought I would throw mine in as well and we can all judge their accuracy as the year progresses.

Obviously some of the factors that are going to affect our property markets are how the R.B.A. reacts to our two speed economy, the European debt crisis and its impact on financing overall, with a general tightening being likely and I believe, more importantly, how both of these impact on the confidence of the average consumer.

With almost 100% of economists agreeing, it seems a reasonably safe bet that the R.B.A.’s first meeting of the year in February will deliver another cut in official rates. Interestingly the ANZ Bank in particular has disengaged from this cycle and is announcing its own rate decisions each month prior to the R.B.A.’s monthly meeting. They cite other global funding issues being equally important as the R.B.A.’s official cash rate in defending this decision. January is the first month for these announcements so it will be interesting to see how they move, but with competition increasing within the banking sector generally I think we will see rates fall over the year, which can only be a good thing for our industry as a whole.
The European debt crisis still has a long way to go in my opinion, with many twists and turns throughout the year to come. I am neither wise enough or game enough to predict the eventual outcome but I am sure the constant reporting of this major bad news story in the media will continue to have a negative impact on consumer confidence generally as well as share prices across most sectors. It is this lack of consumer confidence that looms as a major threat to the year ahead, not just for our industry but the economy as a whole.

The State Government decision to remove the Stamp Duty concession for first home buyers of existing homes saw a rush of activity from this sector at the end of last year, but if history is any guide I don’t expect we will see many first home buyers now for the next 6 months or so, as was the case when the government removed the extra $7,000 first home buyers grant a couple of years ago. These types of incentives tend to bring demand forward and then leave a hole when they are removed.

On a positive note I believe we should see strong demand from investors with rents continuing to climb and vacancy factors at near record lows in most areas. This is leading to increased rental yields generally and in a number of cases, positively geared investments. This trend is likely to continue, particularly if capital growth is subdued and interest rates continue to fall. It may also see some frustrated renters “bite the bullet” and look to buy, particularly if affordability improves.

Over the whole state I feel the market is likely to remain patchy, some areas doing well while others struggle. Local issues will have an impact as the floods in the Northern Rivers area and the mass layoffs by Bluescope in the Illawarra did during the year just past.

So it looks like a year of both challenge and opportunity, and I personally hope that we can assist our members meet those challenges and capitalise on the opportunities going forward with our cutting edge technology, cheaper prices and great staff giving great service.

All the best of the year ahead.

Dale Whittaker
E.A.C. - Chairman

Testimonial for Dougmal Harcourts Oak Flats & Deb Cummins

                                                SOLD - Lindesay Street, Barrack Heights

"The service from Dougmal Harcourts was exemplary to the highest degree. The staff were always courteous and listened to what was asked and very helpful, nothing was of any bother or trouble. Deb Cummins has always displayed professionalism in all her dealings with us and allowed us to be in the loop of how the market and prospects were progressing. Deb, because of her approach and market knowledge was able to sell the house in half a day of being on the market. I congratulate Deb for her ability to keep her finger on the pulse and being right up there with what is happening in the market place. Once again, I would like to thank Dougmal Harcourts for their attentive approach, willingness to co-operate which made the stressful, emotional feeling easier to manage with selling the family home".
R. Woods

Where to for the Housing Market in 2010?

There are a number of factors to consider when trying to look into the crystal ball and predict what is going to happen to residential real estate in the Illawarra in the next 12 months.

The primary driver at the moment would appear to be a wide spread shortage of property for sale. Coupled with slow land releases and a lack of major unit development at the the moment, basic supply and demand economies would indicate upwards pressure on prices.

As far as demand is concerned, there seems to be no shortage of buyers for property at the right price. Investors are starting to come back into the market, taking up some of the slack left by the drop off of first home buyers after the extra subsidies ended on 31 December 2009.

Rises in prices will only be modest however as several negative factors will have an impact. Firstly the 3 interest rate rises of recent times and the probability of another 25 basis points on 2 February 2010 after the Reserve Bank Board meets, along with some job insecurity in the region.

Overall, however I think that the market will be reasonably positive with modest price growth throughout the coming year.

First Home Buyers Grant Reduces

At the end of this month the first home buyers grant reduces from $14,000 when purchasing an existing home to $10,500. This should not be seen as a reason for first home buyers to panic. When looked at in the cold light of day it should have little or no effect on your decision to enter the housing market. The reduction of $3,500 compared to the start of the year when buyers were often in bidding wars and / or races for contracts it may actually be a better time to buy now than it has been over the last 6 months. You will not have quite the same pressure to make a snap decision about your biggest purchase ever, and your bargaining position may be better if there are not as many other purchasers out there.
 I do believe that the next 3 months is a good time to secure your first home as there may well be a lift in prices before too long. This will mainly be due to a supply and demand imbalance. The new home starts in the Illawarra continue to be at record lows which will bring further pressure on existing houses. Basic economics states that if more people want to buy a commodity than there are of those commodities on the market, prices will rise. We are already seeing a drop in the number of existing homes on the market compared to the normal influx of spring activity so this points to price rises in the future.
 The prospect of interest rates rising again will make some people nervous however the commentators seem divided as to when & how much they will rise. It is inevitable that they will rise of course, they are at historic lows, but it is my belief that the rises will be very cautiously implemented by the Reserve Bank as they are unsure about the global outlook and will definitely not want to be blamed for stalling the Australian economies recovery.