3 Costs you absorb if your property doesn’t sell

 

 

What is the cost of changing marketing?

 

There are three costs you absorb if your house doesn’t sell during your agency period.  A vendor may consider changing agents when their property does not sell and in some circumstances that is appropriate but it may be an unnecessary cost.

 

What many vendors do not know is that the two main real estate platforms – Realestate.com.au and Domain.com.au charge you again for the exact same marketing. If you change agents, you can save the cost of new photos because the original photos are yours, however, if you load those photos your listing will effectively look the same.

 

As the vendor, you will pay the main platforms again for almost the exact same marketing. The new agent will struggle to change the copy drastically – as it is the same property – so that cost needs to be considered. Given that the vast majority of buyers use those platforms you receive very little benefit in online marketing as the platform’s reach is the same regardless of the new agent’s efforts.

 

The cost of the platform marketing is also related to the location of the property. That is, some suburbs are more expensive than others. This transfer cost should be considered if it was the market or the price and not the agent’s fault for the no-sale.

 

What is the cost of changing the agent?

 

It is very distressing if your property doesn’t sell. However, it is not always the agent. As a vendor, you may feel it was the agent who was not able to achieve a sale. However, before you change agents ask the following questions:

 

  • Was the agent always honest about the price or did they just accept your price without suggesting there may be issues?

 

  • Did the agent keep you informed constantly about feedback both positive and negative?

 

  • Was the agent pro vendor, not pro buyer? Selling agents work for vendors.

 

  • Did the agent offer strategies to secure a sale during the agency?

 

  • Was the agent easy to contact and return your calls within a reasonable time frame?

 

  • Did they do everything they promised at the listing?

 

If the answers are yes then retaining another agent may cost you and will not be beneficial. Often vendors become tired of always being on the market and then drop their prices in the second agency. If the new agent suggests a price drop then why pay the advertising again? It is more prudent to just stay with the existing agent and save that cost.

 

If you as the vendor later reduce your price with the new agent, you will have paid the extra platform fees for no benefit at all. Remember, the market always determines the price that is the case for all goods and services.

 

What is the cost to change the price?

 

Price is often the culprit when a property doesn’t sell. Price is more sensitive when there are holding costs – a mortgage. The cost of changing the price is also important for the market you may be buying into.

 

Many vendors are reluctant to drop their prices because they need those funds to secure the next property. Another reason may be that the vendor believes their property is as good or better than a neighbouring property. However, it may cost you to not change the price so ask the following questions:

 

  • How much are the holding costs whilst you stay on the market? With today’s rates that may be prohibitive.

 

  • Have you compared like with like?

 

  • Is the market changing? Less finance available? More properties for sale like yours – more supply?

 

  • Was the original estimate offered by the agent lower than yours?

 

  • Will being on the market longer suggest your property has problems?

 

  • Could you miss out on an opportunity?

 

A new agent may seem like a fresh start but the buyers still see the same property on the same sites with the same price. So ask some probing questions before you absorb extra costs.