Frequently Asked Questions
What must the Agent do first of all?
Under NSW law at the time of writing, the Agent must advise the Vendor (Seller) that the Agent's fees are negotiable, prior to signing any agency agreement (which is only to be signed subsequent to the Vendor receiving a Fair Trading Agency Agreements Fact Sheet and having time to digest it).
What is the best way to structure the Agent's Commission?
The best way is to reward the Agent on a scaled commission based on Actual Performance i.e. the more they get for you, the more they get from you. As the old saying goes "Talk's cheap, Show me the money".
Should I pay an Agent an Advertisement Fee?
Do your research on local agents' fees, before paying an Agent to promote their own business. If they can't run their business without you paying their bills as well as their commissions, you might want to know why.
How do I know if the Agent's Appraisal is genuine?
If the Agent doesn't give you written confirmation of the appraisal figure, with written evidence to support the appraisal eg recent sales of comparable homes in your area, plus any other relevant supporting documentation, then you are at risk of not getting what you should get. Laws are tightening in this area to force Agents to justify their appraisals, but any law is only as good as your viable evidence and willingness to prosecute your rights.
Should I open my home to any stranger who turns up?
Agents prefer open homes because the likelihood of getting more listings increases as well as them being able to set Inspection times that suit them. Many Vendors are happy with this because it means they have set times when the house must be appropriately presentable. However, some Owners don't want strangers (who can give any name and phone number to gain authorised entry) wandering through their homes whilst the agent is busy at the front door and therefore insist on Inspection by Appointment only, with the visitor providing proper identification. Discuss this with your agent and make the decision that you are most comfortable with.
Should I sell by Auction, Private Treaty or Tender?
Many Agents like Auction because it makes the job easier than negotiating individually and Owners pay extra for the privilege, plus there is merit in the idea that people will pay more, given the excitement of the event. Some Owners prefer the Agent to deal with people individually and hence prefer Private Treaty. A Tender combines elements of both and so it also has its merits. Think it through before committing, because although you can change your mind until a sale is made, Buyers don't like being mucked around.
What is the best way to advertise and market my home?
Agents usually want to gain maximum exposure and this can cost a lot of money with no outcome guaranteed. Make your commitment with a cool head.
What is the benefit of Signage?
Some Owners want to 'just sell and move on' and so a sign makes sense. Others want privacy because a sign can be a signal for nosey neighbours to ask all sorts of questions and strangers to simply knock on your door expecting entry to 'just look around'. It's your home, you decide after weighing up the costs and benefits to you.
Should I pay for a formal Valuation and also Pest and Building Inspections?
The more informed the Buyer, thanks to the honesty and openness of the Seller, the more credible the asking price and the less delays in the process. Agents are legally required to disclose to Buyers everything they know and should reasonably know, so 'hiding' things is not recommended.
Should I invest in updating/styling or sell as is?
There seems to be a belief common to Vendors that any money 'invested' in a property will yield good profits, but if a Seller has the house repainted and recarpeted in brown and the Buyer hates brown, then it could kill the sale entirely, or at least force a significant discount in the final price as the Buyer 'fixes the problem'. On the other hand, a 'renovator's delight' will only be of interest to dedicated renovators. Get to as many nearby open-houses as you can to see what the 'opposition' are offering before you decide. Regardless, rubbish/junk and untidy gardens and lawns are never ok and will hurt you in the final sale unless your property is a 'renovate or detonate' proposition where the Buyer is really only interested in the land value and possibly the 'bones' of a property if it's not a 'knockdown'.
Does the FRCGW 12.5% tax affect me?
The FRCGW (foreign resident capital gains withholding) is an initiative by the Australian Government which affects every Vendor in Australia selling a property for $750,000 or more. The ATO (Australian Tax Office) has a detailed explanation page at https://www.ato.gov.au/General/Capital-gains-tax/In-detail/Calculating-a-capital-gain-or-loss/Capital-gains-withholding--Impacts-on-foreign-and-Australian-residents/?=banner_home_sec_Foreign_resident_capital_gains_withholding
What is Flipping? Will I lose out selling to a Flipper?
Flipping is the term used to describe the purchase of a property to quickly enhance and sell at a profit. Some Owners object to strangers making a quick profit on their home, but the truth is that Sellers need to decide how much they want and how much they want to enhance their property themselves before selling and either be happy with the price or don't sell until they get the price they are happy with. Of course, some sales are forced (divorce, inability to pay mortgage, urgent relocation etc) in which case, Vendors may reluctantly get less than they want, so urgent conversations with your financial adviser and lawyer as well as Agent, are advised to be sure of your options before you have no options left.