How to successfully sell a property – an insider advises

http://www.theguardian.com/money/2015/jan/22/how-to-sell-your-property

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January is not typically a busy time for the property market, but if you are thinking of putting your home up for sale in the spring it is worth starting to get everything in order. With the vast majority of sellers still entrusting the sale of their property to a traditional estate agent, choosing the wrong one means you could be stuck with them for weeks. Here are some tips on how to make the process as stress-free as possible – based on my years of working as an estate agent.

Start selling before you start buying

Would you accept an offer from a buyer whose own property is not on the market? By all means, get an idea of what you’d like to buy, ensuring your moving plans are viable, but before you start making offers, you really need to be sold subject to contract. Estate agents rarely recommend their clients accept an offer from a buyer with an incomplete chain. A rare exception is where a homeowner with a highly saleable property – perhaps one in the catchment of a popular school – is selling to buy in the same area. In this case the seller can afford to sit tight and will probably find an estate agent very keen to offer good terms to get their property on their books.

Shortlist from the most active local agents

One client admitted she had chosen our agency simply because she liked the colour scheme of our boards, but you will probably want to be a bit more scientific. The best indicator of a successful estate agent is how many of their boards are up near their office. But don’t be overly impressed if they mostly read “For Sale” – these might be the result of anything from the agent overpricing peoples’ homes to a special promotion offering cut price or zero commission. The latter may work, saving you money, but do read the small print. At the end of the promotion, the fee may revert to twice that of other estate agents’. A “Sold” board means the job’s been done. Also, if an agent has recently sold a property in your neighbourhood, they may have had more than one interested buyer. If so, they’re likely to have a list of people who lost out on that property and are ready to buy yours – saving you weeks of viewings.

Decide how many agents you want to use

A sole agency agreement is when one estate agent is instructed exclusively in the sale of a property for an agreed term, usually eight to 12 weeks. During that term, the seller should not switch from or instruct additional agents – if they do, they may end up paying more than one commission. Even when a seller, signed up to a 10-week sole agency, terminates the contract half way through they may still be liable if another estate agent sells the property during what would’ve been the remaining five weeks of the original sole agency.

In a multi-agency agreement, there are no restrictions on how many agents a seller can instruct and no fixed term either. The agents market the property simultaneously and the seller pays only the one that introduces a buyer who contracts to purchase the property.

Both types of agreements have their plus and minus points. The commission rate for sole agency is cheaper than multi-agency but if you instruct the wrong estate agent you will be stuck with them for the duration of the contract.

With a multi-agency you’re not tied to one agent and you can pit those you choose against one another. But while this may keep them on their toes, it may also keep them from being honest with you. Let’s say your sole agent introduces a buyer who offers the full asking price. Unfortunately, this buyer has an incomplete chain below them. Your agent advises you against accepting the offer until the chain comes together, which is sensible advice. Now, same scenario, only this time three estate agents are vying for the commission. The information provided to the seller may differ. The buyer may be presented as being in a stronger position than they really are, so the offer is accepted and the other agents back off, buying time for the less than truthful agent.

Instructing too many agents can also give buyers the wrong impression. I once saw a novice developer give a house he’d refurbished to eight different estate agents to market. All the agents advertised the property with Rightmove which meant the property came up eight times consecutively on the search results page. Did prospective buyers think the seller was keen or desperate? A stream of low offers determined the latter to be the case.

If you’re going to go with a sole agency, don’t get tied in to a long agreement – six to eight weeks is ample time. If you’re happy with the agent, you can always renew an expired contract.

If multi-agency is your preference, stick to a maximum of three estate agents. And where possible, instruct those based in different parts of your post code – that way you’ve got a wider area covered.

Negotiate on asking price and fees

When property is scarce, competition between estate agencies can be fierce. Providing a prospective seller with an inflated appraisal of their home has proved a reliable tactic for agents to win business over their rivals. As a seller, this may work for you in a rising market; at the start of the contract, the property may be overpriced but, by the end of the term once the market’s caught up, the price becomes realistic and the property sells. If the market cools, you could be stuck, unsold and with an agent who’s now recommending a price reduction.

Get an idea of what your property’s worth before calling in the estate agents. Check the property pages of your local paper as well as the internet. However, bear in mind that websites listing sold prices will not specify if a property was in good order or required refurbishment.

Invite a minimum of three estate agents to appraise your property. If one recommends a much higher asking price than the others, ask him why – does he have a special buyer that will pay the higher price? If the commission rates quoted differ, don’t be afraid to negotiate – estate agents are often willing to cut the original rate they ask for. Lastly, do not disclose how much you want for your home or what other agents have quoted until the estate agent in front of you has completed their appraisal and presentation.

Be prepared for viewings

Whether you show the house in the evening or the agent does so during the day while you’re at work, you’ll need to ensure the property’s available for viewing and presentable. I remember one chap instructing us to sell his home then becoming extremely difficult with viewings – allowing us just two one-hour slots a week. He then went away on holiday without telling us and on his return complained about our lack of results and took his property off our books.

If a hectic schedule makes it difficult for you to show your property, give your estate agent a set of keys to show it when you’re not around. Ask that they phone ahead of visiting the property. That way you can monitor the number of viewings plus your agent won’t turn up with prospective buyers while you’re in the shower, or worse. If you provide your agent with a set of keys, they should be stored securely and never released to anyone except authorised people such as surveyors. And once again, a phone call in advance is courteous.

Even where the seller is available for viewings, the estate agent should accompany buyers whenever possible. Doing so will allow other members of the sales team to see the property, not just the negotiator who appraised it. It’s easier to sell a property once you’ve seen it.

Negotiating the offer

When your estate agent presents you with an offer from a buyer, there’s certain information that they must have as a minimum. They should provide you with a breakdown of how the buyer intends to finance the purchase. If a mortgage is involved, how much needs to be raised, and is it in place or subject to employer/accountant references? If the buyer has a chain, your estate agent should check details of that chain prior to notifying you of the offer. This involves calling the relevant estate agents in the chain below.

Your estate agent should never disclose to a prospective buyer how much you will accept for your home unless expressly instructed by you to do so. If your asking price is £300k, the agent volunteering that £295k will close the deal will cost you money if the buyer intended to pay £298k all along.

Where your property has competing offers, it’s good practice for the agent to not disclose one buyer’s offer to another. Doing so may create an auction scenario resulting in buyers overstretching and possibly renegotiating at a later stage. Buyers should be asked for their best and final offers and all information mentioned above confirmed.

Sale agreed

The buyer’s finances and chain have checked out and you’ve accepted their offer. Do you withdraw your property from further viewings? If you don’t, will you accept a higher offer if one is In England and Wales nothing is binding until contracts have been exchanged and so there needs to be an element of trust from all involved. Each case is individual, but as a former estate agent, home buyer and seller, my view is that the property should be withdrawn from the market once the buyer’s survey has been booked. The expense of a survey shows the buyer’s commitment to proceed with the purchase.

Much of what happens during the conveyancing stage of a property sale is beyond the remit of estate agents; however their role does not end there. A good agent should progress the sale along at regular intervals, communicating with you, your buyer, the solicitors and other agents in the chain.

• Steve Lucas is author of Inside EA: A behind the Scenes Look at How Estate Agents Operate