Think Smart, The Smart-RE: An Ethical and Effective Method of Sale

August 4, 2023

Think Smart, The Smart-RE: An Ethical and Effective Method of Sale

The Smart-re Sale Strategy is based upon a simple premise.

What will provide a seller with the best outcome?

The best outcome being defined as:

  • The highest price possible
  • A sale within sellers’ time frame
  • No financial risk

These outcomes stand in stark contrast to most of the real estate strategies in Australia, which focus on quantity over quality and ease of obtaining their own advertising, at the cost of the vendor.

There is little, if any, thought given to the best interests of the sellers.

There are four key components to this sale strategy that puts it ahead of all other methods of sale used by the real estate industry.

Marketing:

Agents and media companies encourage sellers to focus on the amount, size and positioning of advertising, all of which come with extra cost. Sellers are often convinced this extra advertising is necessary to sell their property and are then required to pay thousands of dollars in upfront costs.

However, we understand that quality marketing has been shown as a cost-effective alternative that attracts the same buyers with no financial risk for the seller.

The Smart-re Sale Strategy uses quality marketing designed to allow every potential buyer to find and inspect the property. Quality marketing consists of the right price, good quality photography, a great script, and smart recording of buyer enquiries.

Agents often claim that you can’t sell a secret. However, in the age of online marketing – with detailed buyer databases, filtered searches, and new property alerts – agents are still attempting to convince sellers to pay upfront for largely unnecessary marketing campaigns.

No property is a secret on the Internet.

Another important fact to note is not every property sells with the first agent. Auction clearance rates vary greatly and rarely climb above 60%.

It is the sellers, not agents, who bear the marketing costs of any failed campaign, costs that routinely run into thousands of dollars.

Our marketing campaign will produce the best buyer – that’s why there are no upfront costs to sellers. Surely the true test of any marketing campaign is the result: has the property sold?

If the answer is no, then why should the seller pay?

Therefore, the golden rule of selling property is:

Pay no money (including marketing costs) until your property is sold and you are happy with the result.

Price:

Our commitment to you requires pricing information that is evidence-based be provided to the seller prior to the sales process beginning. This is in the form of comparable, recently sold properties, reference to other properties that will compete within the same buyer pool and current market demand for their style of property.

When sellers have an accurate price indication, they can make decisions based on evidence rather than opinion. This is critical in reducing the ever-present risk of underselling.

One of the most despised traits in real estate agents is their willingness to either inflate or omit the likely selling price of a property to get business. Unfortunately, this is still a common practice throughout the industry.

The two most common lies told by real estate agents involve the price estimate quoted to potential sellers:

The Improbable Lie
This is when an agent intentionally inflates a property’s potential selling price; it’s the lie most people are aware of and dislike about real estate agents.

The Lie of Omission
This is when an agent, knowing the probable selling price, chooses not to tell the owner. The Lie of Omission is a subtle lie, but prevalent in the industry.

Both lies have the capacity to hurt sellers financially and emotionally.

An agent who is honest about all facets of selling, including price, is a rare and true professional.

Remember, any method of sale should be chosen on its ability to find the best buyer for a property in the seller’s preferred time frame. Furthermore, it must facilitate negotiation of a buyer’s maximum price, often this can be $30,000 or more extra in a seller’s pocket.

Inspections:

The inspection process is an important step to the negotiation and requires that one-on-one inspections are always available to buyers. This is particularly important in a stable or falling market.

If the power tips towards the buyer, the property should be available for inspection at a time that suits them. If a genuine buyer wants an inspection, the agent should arrange it. In stable or falling markets there are fewer buyers and more properties for sale. Forcing buyers to wait for a scheduled open home increases the chance they will purchase elsewhere.

A private appointment to inspect, set promptly, increases a buyer’s expectation this property will sell quickly, in turn increasing the negotiation power of the seller.

Effective follow-up enables our agents to develop an understanding of an interested buyer,
their motives and budget – information necessary to negotiate the best price.

Negotiation:

Most agents simply don’t understand real estate negotiation and instead choose to use an ‘offer process’.

This is not negotiation. An ‘offer process’ is simply the conveying of a buyer’s offer to the seller. We know this isn’t a negotiation strategy, but rather a basic mediation.

A mediator is a person who assists and guides parties toward their own resolution. The mediator does not decide, nor influence the outcome. They simply allow parties to reach an acceptable agreement with one another.

When selling property, you do not want a mediator. Sellers need a negotiation strategy and a trained negotiator.

The Smart-re Sale Strategy is simply the best method of negotiation when there are multiple buyers and the only effective method of sale when there is only one.

Why is this strategy the best method when there are multiple buyers?
The quality marketing and inspection strategies ensure there are no buyers that don’t discover, and then inspect, the property.

With multiple buyers, a competitive (rather than comparative) negotiation strategy is essential. Any method that allows a buyer to see, or even have an indication of, another’s offer guarantees the property will be undersold.

We ensure each interested party in a multiple buyer scenario pays their maximum price, ensuring that a property is never undersold.

Why is this strategy the only effective method when there is only one buyer?
The same components just mentioned, quality marketing and an integrated inspection strategy, ensure when there is only one great buyer they will be found.

An agent’s negotiation ability is their true value to the seller – a point that is often overlooked or misunderstood. The skills and tactics employed after an interested buyer is found – the method of sale, the marketing, the pricing, and the inspections – all lead to this final negotiation.

The contract negotiation is the last chance a seller gets to obtain the best price in the market today.

An agent with great negotiation skills and the right strategy can make a difference of tens of thousands of dollars. With the wrong agent, the loss to the sellers can be in the tens of thousands.

Costs:

Here at Tim Altass Real Estate, we believe we must add more value than we charge.

Consider this, if an agent charges an extra $5,000 but negotiates an extra $20,000, wouldn’t you agree that this agent is $15,000 more valuable to you than the cheaper competitor?

Often people will hire a real estate agent based on the answers to these two questions:

  • How much will you get me?
  • How much do you charge?

On the surface these questions appear to be a fair and reasonable way to choose an agent.

However, quite simply they are the wrong questions to ask. Smart sellers understand that superficial questions invite superficial answers.

Any agent being interviewed must be able to prove their value. Sellers must dig deeper than the superficial to make a smart decision.

Always consider value as opposed to cost when selecting an agent.

The Sale Guarantee

One final point to consider is the written guarantee. Agents make many promises when presenting their services to sellers, but if their service is as good as they say it is, are they willing to guarantee it? If not, why not?

Guarantees provide property sellers with the peace of mind that if they select the wrong agent, they are not stuck with them.

It is an unfortunate truth an agent’s promises cannot be kept at face value. Therefore, along with their listing agreements, agents should offer a dismissal clause. If the agent doesn’t deliver on their promises, you can end the selling agreement.

A fair dismissal clause allows the agent a brief period to resolve any problems and continue as your agent if they do.

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