What are the advantages and disadvantages of selling a property privately ie by yourself without signing up a real estate agency?
As lawyer, conveyancer and licensed estate agent, I am in a position to confirm that there is a distinct advantage in bypassing the estate agent and to save money. Estate agents like to have consumers believe that they can make a huge difference by gaining above and beyond what they charge in commission. However, the reality is that real estate rarely sells for more than its current market value, and current market value is a figure that is easily determined before a vendor decides to sell.
I’m happy to discuss this with anyone who needs more information.
So getting the right market value is paramount Peter is that what you are saying? What about agents negotiating to get a higher price, don’t they do this?
If we factor in some of the constraints on an estate agent’s ability to negotiate a higher price we see that there isn’t much wriggle room. Agents are not allowed to advertise a price without reference to other recent sales - that’s something of a starting point. Next is the fact that most purchasers rely on bank finance and will purchase ‘subject to loan approval’. The bank will not accept the property as security if the purchaser has paid too much for it, and this is a further cap on price. Then we have the estate agent’s own Exclusive Sale Authority, which gives the estate agent a limited time to achieve a sale, usually on a no-sale no commission basis. If faced with a choice between zero commission and a low commission on a low price, and estate agent is more likely to talk a vendor into accepting a purchaser’s offer than to talk a purchaser into accepting a vendor’s over-the-top asking price.
So, the involvement of the estate agent is limited, and can even work against a vendor who has plenty of time in which to make a sale.