The risks of privately selling your property
18th May, 2017
When considering selling a property, about one per cent of all vendors choose to promote their property for sale themselves or with limited assistance from other service providers, such as Buy My Place, For Sale By Owner, No Agent Property, Go Private or – the latest of these players – Purple Bricks.
These companies essentially run a web portal offering limited advice and assistance to the seller during the process.
Purple Bricks is a little different in that a real estate agent is involved in the process, offering constrained services for a small fee, but it is, based on what I have seen, just like all the other services already available.
These are ‘pseudo agents’, businesses that purport to “save you $1,000’s in agent commissions,” by offering tacit support in how to handle contracts and put up a ‘for sale’ sign.
These websites underestimate the true value of a professional experienced agent and are, in my opinion, a waste of time and money.
Why selling privately is not the answer
Apart from the obvious difficulties private sellers experience in accessing effective marketing media, the value of employing an agent is the ‘arm’s length’ benefit.
Private sellers cannot understand why, after many weeks of home opens, everyone tells them their home is lovely, but no one has offered to buy it. Buyers are normally too polite to tell the seller what they really think; that the property is over-priced, too small, too cluttered etc., but they will happily tell the agent their raw opinions on the property and its subsequent value.
Most private sellers also lack sufficient knowledge of contractual procedure, an understanding of the Strata Titles Act for example, planning and heritage issues, and matters concerning compliance and disclosure. And very few private sellers have an intimate knowledge of the Joint Form of General Conditions for the Sale of Land, the 23 page legal document that forms part of the sale contract.
REIWA agents are experts in this area and are required to continually update their education and professional training, as part of their REIWA membership, to ensure their clients are provided with the highest level of service and expertise. They are also required to hold professional indemnity insurance to ensure the sellers protection.
Use a registered REIWA agent
Arguably the most important reason to use a REIWA agent is that much of the risk associated with selling property is transferred from the seller to the agent. In the rare instance something goes awry with the sale, the seller is entitled to look to their agent for guidance and, if appropriate, apportion blame if the agent has acted improperly.
Professional REIWA agents can make the task of selling property look relatively easy, but I assure you it’s not. The risks of selling privately far outweigh any vague possibility of saving money on the agent’s selling fee.
Source – REIWA 13 May 2017
Author: REIWA President Hayden Groves