Agent rate cuts don’t work
Category Blog
There is no short route to achieving optimum value in a home sale – even at the best of times. And cut rate offerings are certainly not the solution. In fact, home sellers who opt to go with estate agent bargain offerings will almost certainly be compromised on price…and peace of mind.
Not least so in Johannesburg’s Northern Suburbs/Sandton. Home values in the area continue to mark time in the face of persistent national political and economic uncertainty and fragility.
(This sentiment seems set to persist at least until the close of the ruling party’s national elective conference in December. In fact, it may not even happen, given the extent to which party structures are reportedly fragmenting and fracturing all over the country.)
Competitive selling
Meanwhile, as many as 20 to 30 active real estate agents continue to compete with each other in any single suburb at any given time in the Northern Suburbs/Sandton home market.
But there are normally no more than half a dozen of them who stand out and deliver a service that earns them a reasonable living.
In any good suburb, there would normally be two or three specifically area-focused agents who have remained dominant for years. Between them they will account for as much as 60% to 70% of available business on an ongoing basis.
They will invariably be long-standing, successful, agents in their precincts. And their modus operandi will generally be to market on sole mandate. They would also know many residents by name. Behind them would be another two agents that take care of 20% of the area’s volume. The balance of 15 agents would jostle for the remaining 10 per cent slice of sales.
Therefore, agents must constantly ensure that they deliver sufficient (non- income-producing) legwork in order even to reach first base – which is an invitation to pitch for a sale mandate.
Good agents handle a multitude of functions and tasks that sellers are generally not even aware of. This is not unlike the structure of an iceberg – the bulk of which always remains unseen. To start with, it can be a mission for an agent simply to get to arrive at the sellers’ front door.
A trio of agents
The seller would normally invite no more than three agents to assess his residence and provide an estimate of market price. This in itself is a mission for the seller – given that generally ten-times that number of agents will be focused on the particular area.
So, nobody considers the amount of work that goes into getting to quote on selling the house. A great deal of time and cost involved.
Simply getting to the front door, let alone crossing the threshold, is an accomplishment.
What the seller has seen to this point is no more than the tip of the iceberg. What remains out of sight is the immense amount of work the agent has done just simply to arrive at the front door.
Author: Ronald Ennik
