Agent Commission – What Is It Good For?
With the current housing market boom, everyone is looking for the best price. Sellers want great returns on investment. Buyers want the lowest purchase price.
This might leave some wondering: “Why bother with an agent, since their commission impacts the what the seller gets to keep?”
Well, the short answer is: it’s not as easy as it looks.
Despite estate agents having a bad reputation for ‘getting money for nothing’, procuring an agent’s help, especially as a seller, can really streamline the process and help maximise the sale price. A good agent from a reputable agency can connect you with a whole pool of possible buyers to whom you would otherwise not have access, even with the popularity of online property listing platforms. Furthermore, estate agents are qualified in both real estate and marketing, which means they are better able to identify trends, pitch properties to the most likely buyers, and sell your house as quickly as possible. Speed of sale is key to many sellers, in addition to getting the best possible price.
Agent commission also pays for an agent’s knowledge of an area. For example, the Nelson real estate market differs from real estate in Invercargill. Agents operating in these respective cities are well-versed in the realities of each market. Their market insight takes time and effort to gather, and while you might be able to guestimate a selling price for your home based on similar listings, a good agent would have a better gauge of the true value of your property and what you might reasonably expect to sell it for, which will make selling it easier.
Estate agents are also valuable during negotiations, particularly if buyer and seller are at a stalemate. An agent worth their commission will function objectively to try to come to the best arrangement for all involved.
So, before getting rid of the ‘middleman’, remember that whatever you might ‘save’ in selling your home alone is likely to be absorbed back into the costs associated with losing valuable time, effort, and expertise.