{"id":5855,"date":"2015-09-21T08:53:34","date_gmt":"2015-09-20T22:53:34","guid":{"rendered":"http:\/\/www.realestatetalk.com.au\/?p=5855"},"modified":"2015-09-21T08:53:34","modified_gmt":"2015-09-20T22:53:34","slug":"an-angel-on-your-shoulder","status":"publish","type":"post","link":"https:\/\/channels.realty.com.au\/realtytalk\/an-angel-on-your-shoulder\/","title":{"rendered":"An Angel on your shoulder"},"content":{"rendered":"

Get a vendors\u2019 advocate on your side to maximize\u00a0results and minimise\u00a0selling hassles.
\nKieran Clair<\/b> [@kieranclair]<\/b>
\nThe evolution of transacting property has reached new levels in the past decade. A whole raft of fresh professionals has entered the process in order to make sure clients get a fair deal. Buyers\u2019 agents have become firmly established in the lexicon, but there\u2019s a new service in town making waves.
\nVendors\u2019 advocates (VA) are building a presence by keeping the seller\u2019s interests front and centre throughout the disposal of their valuable assets. But there\u2019s an elephant in this room \u2013 aren\u2019t real estate agents already performing on behalf of vendors? Why is a VA needed? A proper look at the service helps paint the picture.<\/p>\n

AGENTS VS ADVOCATES<\/strong><\/h2>\n

Vendor advocacy is mostly an extension of the services offered by buyers\u2019 agents. It\u2019s been an organic progression for the profession, according to Janet Spencer, managing director of Buyers Solutions. She says clients build their property portfolio with her guidance, trusting her judgment and devotion to keeping their interests at heart. As such, in a world where every agent is competing for business, clients have naturally started turning to their buyers\u2019 agent for selling advice as well.
\n\u201cIn my role as the buyers\u2019 advocate, I\u2019m mystery shopping all the selling agents all the time.
\n\u201cI\u2019m a good go-to person who knows who does a really good job as a selling agent and who doesn\u2019t, because when you\u2019re the vendor, you want the agent who walks the walk as well as talks the talk.\u201d
\nSpencer says regardless of good, honest, hard-working agents doing a great job of selling property, it\u2019s difficult for the general public to get past the vested interest that comes from their selling commissions.
\nWhile most agents are honourable and trustworthy, there are practices perceived as dodgy.
\nFor example, advertising not only benefits the seller but also helps market the agent. A VA can step in and make sure the marketing spend is reasonable and correct, Spencer says.
\n\u201cSometimes we can encourage a vendor to spend a bit more on marketing when we think it will be useful and sometimes we can also encourage them to spend a bit less, if we think it\u2019s gratuitous.\u201d<\/p>\n

WHY BOTHER?<\/strong><\/h2>\n

Spencer says real estate plays a major role in the drama of a client\u2019s life, so having a VA to lean on means much less stress for all. She quotes one example of a client who was pleased to have a VA by their side.
\n\u201cIt\u2019s a common practice in Melbourne auctions to put in a \u2018kicker\u2019, which is if the reserve price is at a certain level, the agent might take 10 per cent of any dollar above that.
\n\u201cI remember we were at an auction one day and the agent said, \u2018Why don\u2019t we set the reserve at $1.6 million?\u2019 and the kicker was 10 per cent of every penny above $1.6 million.
\n\u201cThe bell was ringing, \u2018Let\u2019s go, ladies and gentlemen, let\u2019s all have the auction!\u2019 and I just said, \u2018Why don\u2019t we set the reserve at $1.7 million?\u2019 and the property sold for $1.92 million.\u201d
\nThat\u2019s a $10,000 saving in commission just for Spencer being present.
\n\u201cI\u2019m not saying they [the agents] were being dodgy either, it\u2019s just seeing advocacy objectives and thinking on your feet in the moment.\u201d
\nPatrick Bright, director of EPS Property Search, believes VA services offer a voice of reason that can help save some sellers from themselves. For example, vendors might choose the agent that suggests the highest listing price.
\n\u201cWhat happens is people say, \u2018One agent says $1.3 million, one says $1.4\u00a0million, one says $1.5 million.\u2019 Then they go, \u2018the one at $1.5 million believes in my property more than the others. I should give it to them to sell.\u2019
\n\u201cThe oldest trick in the book in real estate is to \u2018buy\u2019 the business.\u201d
\nBright says by offering an independent sounding board on all matters, the client can make informed, accurate decisions.
\n\u201cIn Sydney at the moment Humphrey B Bear could sell the property. You don\u2019t need to be too clever, but the difference between a good price and a great price is a great agent.\u201d<\/p>\n

THE PROCESS<\/strong><\/h2>\n

When offering his VA services, Tony Coughran<\/a>, adviser with VFM Property Advisors, presents six distinct steps to his clients so they know exactly what to expect.<\/p>\n

    \n
  1. Establish the property\u2019s value: <\/strong>\u201cValue is key. The first step is to value and assess the true worth in the marketplace. Provide our client with a full market analysis, equipping them with the most complete and accurate information so they can make an informed decision. Then we can formulate a strategy for marketing the property.\u201d<\/li>\n
  2. Prepare the property for sale: <\/strong>\u201cOnce we\u2019ve established a realistic selling range, then we can provide recommendations on how to improve the value of the property overall, at minimal cost and maximum return. We can recommend services from builders, painters, landscapers, property stylists and photography \u2013 even furniture staging to get their home presented in its best light.\u201d<\/li>\n
  3. Find the best agent: <\/strong>\u201cSelecting that perfect agent is critical, it\u2019s crucial. We\u2019ll use all of our market insights, knowledge and experiences to short-list it to suitable, top-selling agents in that area for our client. We\u2019ll invite them to submit their appraisals and marketing strategies and we\u2019ll provide recommendations based on these proposal strategies.\u201d<\/li>\n
  4. Going to market: <\/strong>\u201cIt\u2019s our job to protect our client\u2019s interest and make sure all the services are being followed through and expectations met\u2026 We\u2019ll liaise with the selling agent, on behalf of the buyers with their questions, and address any concerns that might come up\u2026 it\u2019s good to be comforted with us as your sounding board. Use us as much or as little as you like and take the emotion out of the process.\u201d<\/li>\n
  5. Negotiating the sale:<\/strong> \u201cThis is another big part of the process. It\u2019s not a simple process \u2013 there\u2019s quite a bit in it.\u201d<\/li>\n
  6. Keeping things moving:<\/strong> \u201cMaking sure everything is running on track for settlement after a contract has been accepted and dated\u2026 offer advice when needed. Make sure the building and pest inspections are running smoothly and meeting deadlines.\u201dBright says he offers whatever level of advice the sellers need, but doesn\u2019t want them to be removed from proceedings. With agent selection, for example, he\u2019ll happily sit with the client during the interviews, but ultimately they\u2019ve got to take responsibility for the agent they choose.\u201cOnce I get involved in that process I say, \u2018Here\u2019s a shortlist of three agents. They\u2019re all good\u2026 They\u2019re in that 20 per cent of the marketplace that you would use that are competent and professional.\u2019\u201cThen I say, \u2018Just pick the one you like the most \u2013 the one you gel with because it\u2019s going to be a weeks or months process, so you\u2019re going to have to like who you work with.\u201dUltimately, Bright says, you have to trust any professional you\u2019ve employed, or the process breaks down.\u201cI don\u2019t do the agent\u2019s job for them\u2026 Look, they\u2019re the experts.\u201cDon\u2019t hire somebody and then not listen to them.\u201cYou\u2019ve made a decision, you\u2019ve hired someone, now listen to them. Otherwise, don\u2019t hire them.\u201d
    \n

    WHAT TO LOOK FOR<\/strong><\/h2>\n

    Coughran says there are essential characteristics that VAs should have. First and foremost, be a great listener and communicator. He also recommends using a well-respected member of the local real estate community \u2013 someone with good local contacts is a must.
    \n\u201cYou need to be experienced and have runs on the board in buying properties and seeing the selling process. If they haven\u2019t been achieving great results, then you\u2019d be questioning their abilities to get your premium result.\u201d
    \nCoughran believes trust is the final major component.
    \n\u201cA good VA will bridge that lack of trust that you might have with the selling agent, and empower you with the information so that you make a really informed decision.\u201d
    \nSpencer had one other essential when it came to selecting a VA.
    \n\u201cI\u2019d make sure they\u2019ve had direct experience as a selling agent themselves. I think that brings empathy and professional respect,\u201d he says.<\/li>\n<\/ol>\n

     <\/p>\n

    \"investorsnapshot\"FEES<\/strong><\/h2>\n

    One upside to using a VA is, in most cases, you don\u2019t pay a direct fee. In some instances, the cost is included as part of other advisory work. VAs also earn their fee as a percentage of the selling agent\u2019s commissions.
    \nThis may seem like a conflict of interest, but Bright explains the process of agents paying a \u201cspotter\u2019s fee\u201d or co-commission is well-entrenched.
    \n\u201cThere are two types of vendors\u2019 advocates. There are ones that charge an hourly rate to give that advice and counsel, and there are ones that will receive 20 or 30 per cent referral fee from the sales agent for handling that side of things. It\u2019s all disclosed \u2013 there\u2019s no secret commissions or kick-backs here.\u201d
    \nCoughran\u2019s approach is to charge an upfront retainer that\u2019s refunded on settlement.
    \n\u201cWe just want to ensure that we\u2019re investing our time with serious sellers. At the end of the day, effectively, we\u2019re a no-cost service. The selling agent does pay us our professional advisory fee, that\u2019s paid out of the commission that you\u2019re already paying them anyway. You\u2019re getting two professionals for the price of one. What more can you want? That\u2019s value for money.\u201d
    \nIt\u2019s hard to argue with that logic.<\/p>\n","protected":false},"excerpt":{"rendered":"

    Get a vendors\u2019 advocate on your side to maximize\u00a0results and minimise\u00a0selling hassles. Kieran Clair [@kieranclair] The evolution of transacting property has reached new levels in the past decade. 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