The first thing every property owner should do when they are thinking of selling is to invite two or three salespersons to come and have a look through the property. Inviting more than one salesperson is advisable because it will give you an opportunity to compare what they have to offer and choose the right one for you.
The purpose of the inspection is to familiarise the salespersons with the features and the condition of the property. This also gives them an opportunity to make a note of any issues that might impact the saleability, such as non-compliance of any sort or defects. Once they have inspected the property, they have all the information they need to do an appraisal or a CMA for you.
Comparative Market Appraisal (CMA)
The REA Code of Conduct requires every salesperson, to provide a written appraisal of the value of a property, before entering into an agreement to sell a property.
A good appraisal is the key to making a sale. It must take into account the sale price of similar properties recently sold in the area along with the difference in size, age, construction materials, amenities, chattels and location.
Sellers should be aware that an appraisal is based on past sales and does not account for future changes in regulations, legislation, economic conditions and market sentiment. If prices are trending upwards, the sale price achieved might exceed the appraised value and vice versa.
The salesperson that says your house is worth a lot more than what other salespersons say, may not be the best person for the job. It is a good idea to ask at least two salespersons to do an appraisal. This is also called a Comparative Market Analysis or CMA. When more than one agent is in the same ballpark, then that is probably the price you can expect for your property.
Avoid the temptation of selecting the salesperson who tells you that the house is worth more than what can be reasonably expected. In real estate jargon, it’s called “buying a listing”. Remember, a real estate salesperson is unlikely to buy any property, unless they are getting a bargain.
Evaluate the process each salesperson has used to do the CMA. Look at the comparable properties that have been selected and see if they have factored in the differences between the properties. Look at the attention to detail, the quality and the clarity of the presentation. The CMA will provide an insight of how each salesperson will present your property to prospective buyers and demonstrate their professional abilities.
Ask the salespersons about their qualifications, experience and local area knowledge. Check the salespersons references and online reviews.
Check the salespersons Licensing credentials on rea.govt.nz to make sure they have a good record. Ask the salespersons how often you will receive a marketing report.