The Sales Process

Like many industries, the real estate industry suffers from a lack of transparency, and this has only benefitted the best-known agencies in the past. What many prospective vendors don't know is how much pressure agencies can put on their agents, which in turn forces agents to behave in negative ways with regards to their clients.

The fact is that almost every real estate agency in Australia takes a whopping 40-60% of the commission from every sale made by every agent who uses their brand. This puts agents under immense pressure to perform, and often means that agents list more than they can sell.

Wentworth Partners offers a different approach. Because we have low, capped fees, our agents have the freedom to be able to put more time and effort into each property that they sell. With financial freedom, Wentworth Partners agents can fully dedicate themselves to your campaign, which returns better results for you.

Choosing an agent is a personal matter, so it's worth taking the time to meet with prospective agents to see who is right to sell your property. Here are some tips on what to look for when selecting a real estate agent.

• Does your agent know your target audience? Ask them how they intend to sell your property, and who they would define as your target market. A good agent will understand your property's inherent strengths and the appropriate marketing strategy to reach future buyers.
• Is the agent using market data? A strong grasp of the local market data is essential as it should form the backbone of your pricing strategy. They should also use the data to guide the decision on the right way to sell the property, and any minor alterations that will help to set your property apart.
• Does your agent have local area knowledge? Understanding the demographics, schools, public transport options and local attractions is imperative. 58% of Australians buy homes within 5 kms of their current address, and 98% look within a 40 km radius of their local area. This makes an in-depth knowledge critical, as the buyer will already know a great deal. Agents should also be abreast of any new developments or infrastructure that will make a difference to buyers.
• Does your agent understand multi-channel marketing? Although it might seem appealing to spend little on marketing, it won't help your sales price. Ask your agent what marketing avenues they intend to use- it should include digital, print and social, or it could be limited to online marketing only, depending on the area and demographics.
• Ask about commission. Even in soft markets, the best agents can secure business without slashing commission rates. Whilst it's tempting to try to push down commission fees, remember that this is the incentive that drives an agent. When it comes to selling your home, you should be able to strike a good balance between finding a committed agent and paying a reasonable commission for this.

Private Treaty

Private treaty sales are where a property is listed for sale within a specific price range, and the sale of that property is negotiated privately between the buyer and the seller via the agent.

There's no set deadline for the expiry of a private treaty sale, which helps when there are few buyers for the property, or when the market isn't particularly buoyant. Private treaty also benefits sellers who don't have the urgency to sell, or who want to avoid the extra costs involved with auctioning.

Private treaty also offers greater flexibility in terms of settlement periods. It appeals to buyers purchasing subject to finance, or buyers and sellers who need to incorporate specific terms in the contract (eg a long settlement period).

Buyers often find this process less intimidating than auctions. Indeed, auctions can lock out some potential buyers because the buyers who are subject to finance often can't commit to auction terms.

In a private treaty campaign, the seller is guided by the agent in setting a price range for their property. The benefit of setting a price range means that the agent can negotiate a premium price, using real examples of properties sold in the suburb in the past 90 days to 6 months.

On the flip side, a key limitation of private sales/ treaties is that the price can also get negotiated downwards. When buyers know the sales price, the property is less likely to sell for a greater amount than this. This is why our agents prefer to set price ranges, or just point towards the suburb's recent property sales as price indicators.

The agent takes offers and negotiates with buyers until the seller is satisfied with the sales price. After this the contracts are exchanged and the buyer pays a deposit, with a five day cooling off period. In this time, the buyer completes their legal obligations and secures their finance approval ahead of exchange.

Unlike an auction, which hands ultimate control to the market for the sale of your home, a private treaty campaign can give greater control over offers made, and more time to consider whether to accept or decline them.

It also allows more flexibility in the terms of sale (ie deposit amount and settlement terms) which can potentially open your home up to a greater range of buyers. Sellers often turn to this method when interest in the property market is lower than normal.

Auction

Selling properties via auction has been lucrative in Australia, with good reason. Auctions create competition, allow the vendor to set the terms of the sales contract, and they also allow flexibility.

Auctions create a sense of urgency amongst buyers. This is due to the imminent 'end date' for the property sale that compels buyers to make a decision there and then.

It also fosters competition. When two or more potential buyers start bidding against each other, it pushes the sales price up with the result that the selling price exceeds the expected value of the property. This is what has made auctions so popular, as they maximise the sale price for the seller.

An auction also protects the vendor in the form of a reserve price. This means that your property won't sell unless bidding reaches or surpasses a pre-agreed level. With no ceiling price, this enables the opportunity to exceed expectations when there is a competitive crowd.

Auctions also suit vendors with specific settlement terms, who are happy with an unconditional sale. There is no cooling off period for auctions.

On the down side, there may be additional costs to selling an auction in terms of paying a specialist auctioneer. It's important to discuss these extra costs with your agent.

Also, bear in mind that buyers who are subject to financing approval cannot bid at auctions, which can limit the number of buyers that register to bid.

That said, there is ample proof that auctions have been enormously successful in Australia in the past two decades. They can also help an early sale via private treaty, where potential purchasers put in a well-priced private bid in an effort to secure the property prior to the event. Vendors will particularly benefit from using the auction format in competitive markets.

Open Negotiation

The last- and newest- method for selling a property is called Open Negotiation. Open Negotiation is an incredibly successful process that bears similarities to a business tender.

Open negotiation works by inviting buyers to submit offers with the conditions that they choose, in the lead up to a predetermined purchase date. If the seller approves their terms and conditions, the buyer can then participate in the open negotiation.

The appeal of open negotiation is its transparency. Unlike with private treaty, each buyer's offer is revealed to the other participating buyers. This transparency can be a welcome relief to buyers as it gives them a clearer understanding of the other buyers' positions. In practice, the major beneficiaries are the sellers, because it creates a competitive environment that is similar to an auction.

Like with auctions, open negotiation requires an auctioneer to conduct the sale. Buyers also get to see how many bidders are involved in the process, and how much time they have left to bid. Bidding takes place online. Also similar to auctions, the property has to pass its reserve price, until there is one final, unchallenged bid. In most cases, this process continues across days or weeks, which can also help the buyer finalise their financing.

The key difference between auctions and open negotiations is the fact that each buyer can have different pre-agreed conditions. By comparison, the terms of purchase for an auction (ie deposit amount and settlement amount) are the same for all buyers.

Because the buyer can nominate the terms that suit them, open negotiation can create a potentially wider pool of buyers, which fosters greater competition. In this way, open negotiation neatly fills the gap between private treaty and auction sale.

Here are some quick tips for choosing the best lawyer or conveyancer to write your contract.

• Shop around for options. Your real estate agent can provide suggestions but there are many to choose from in every area
• Cheap isn't always better- especially if you have unique terms and conditions
• Make sure you stay in contact in case of unforeseen circumstances
• Ask for property searches. It's a conveyancer's job to conduct searches on the property to check if amenities are connected, if there will be imminent construction, issues with contaminated land, and so much more. A great conveyancer helps you avoid the pitfalls.
• Ask questions- your lawyer is there to help you understand the legalities of your home, so don't be afraid to ask questions. A good lawyer will make sure you understand everything before you sign any documents.

Property styling has become big business due to the high returns it generates for your final sales price, and is an essential item to consider before the photographer comes through the door. You can hire stylists from around $2,000, but there's plenty you can do to maximise your visuals without professional help.

Identify your target buyers

Before getting excited about new décor, you need to identify who is likely to buy your home. IF it's for families, you might create a nursery, whereas professionals might prefer to see an office in the spare room.

Style Appropriately

If starting from scratch, stylists have a simple approach.

Industrial style for young buyers

Scandinavian style for young families

Hamptons style for older buyers

Basic furnishing for investors.

Also look to your home for inspiration. A country Federation home requires different décor than a contemporary apartment, for example.

DIY Tips

Sometimes all your home needs to show it's best qualities is a little bit of care and attention. Here are some simple things to think about before you market your home.

• Stick to a single colour scheme
• If in doubt, white it out. Different shades of white can make spaces larger
• If you have bad flooring, find a rug to hide it
• Declutter everywhere! Hire storage for items that take up too much space
• Buy potted plants rather than cut flowers to avoid buying new posies each week
• Scatter cushions and textured throws might be all you need to brighten up your lounge room or bedroom.
• Make sure to have plain, fluffy linens in the bathroom

Getting A Stylist

When you're really not sure about style, or if you feel that your furniture is too dated, it can be useful to call in professional stylists. Basic packages can start from $2,000, but larger homes may need up to $10,000 to create the right ambience. You'll be amazed by the results… and happy with the extra value a professional style can add to your final sales price.

A final checklist before photoshoots and open homes:

• Thoroughly clean your home and sugar soap dirty walls
• Clear away all clutter, personal effects, photos and valuables
• Sweep your entrance, weed the garden, shake your door mats
• Water all plants inside and out
• Turn on all lights and lamps
• Angle shutters and curtains to let in maximum light
• In cool weather, warm your home, otherwise switch on air conditioning
• Empty your bins
• Dress up your beds and sofas
• Wipe away excess water from showers, sinks and benchtops

What Every Campaign Needs

Australians are highly visual, and real estate marketing has become competitive in the past decades. To make a splash you need to have some basics in place. A strong property marketing campaign should start with these elements:

• Professional photography
• Professional copywriting
• Professional floorplan
• Optional videos or 360 degree virtual tours
• A beautiful online and printed buyer book that brings your property to life

Marketing Your Home

A great agent will understand your target audience and be able to make experienced suggestions in what channels are the best to reach them.

Digital Listing Types

It's generally understood that most buyers will look towards Domain.com.au and RealEstate.com.au to find a property, and so listing on one or both of these channels is imperative. However not all listings are equal. The number of views and buyer enquiries that are generated by your ad will depend on the ad size, search results ranking and advertising duration.

High exposure listings are large ads that are pinned to the top of the search rankings. The results for these ads surpass any other type, and deliver the most bang for your buck.

Social Media Ads

60% of Australians are on Facebook and Instagram

90% of people on the internet can be reached by the Google Display Network.

The best campaign is one that analyses data from Google and Facebook to work out who might be interested in your home. To do this, take a three-step approach.

1. Go Local
   With location targeting, a good social media campaign can show your home to tens of thousands of people in your local area (remember 58% of people move within 5kms of their existing address)
2. Find People Searching for Property
   By analysing buyers' online profiles, spending habits and web searches, a good campaign can find those who are likely and able to buy your home
3. Agent Database
   Good agents have their databases online so your property ads can re-target their prospective buyers- and 'lookalike' buyers (people who share the same characteristics).

According to Facebook, the second-most discovered product on this social media platform in Australia is real estate. This is backed by data- our property ads are typically shown

60,000 times

across Facebook, Instagram, YouTube and the web, to engaged audiences in a 10km radius of your home. An average of

1,500 people

Then click to view detailed information about your property and visit your online listing. On a few occasions, this can result in a sale before it has even been officially listed on Domain.com.au or RealEstate.com.au.

Print Campaigns

Print campaigns and letterbox drops are fast becoming a thing of the past. In specific circumstances such as when targeting an older demographic, a print campaign can be worthwhile. However in many cases your campaign budget is better used in social media campaigns. Your agent will be best placed to discuss what will suit your property best.

If you choose to go to auction or conduct an open negotiation, talk to your agent about new ways that these events can be conducted online. Whilst there may be additional costs to running a virtual auction or online open negotiation, recent events have demonstrated the extra reach that a digital sales process can achieve.

Congratulations on getting a great deal!

Why is it that you can track your pizza, but you can't track the progress of the sale of your greatest asset? Times are changing, and now it's possible to gain peace of mind by knowing where you are in the final steps. Talk to your agent about how you can get to see each stage of the financing process.