they do it to hook in as much of the market as possible then use emotional tactics to get people to go over their budgets. I'm happy to say our offer had a 5 in front of the sale price and it was accepted haha. go suck on that one REA lol
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12-07-2015 08:11 #41
12-07-2015 08:26 #42
Yeah I get that it's their job to get the highest price, but at the end of the day, when housing is so expensive and many cannot afford their mortgages, then there is something seriously wrong.
Basically it's greedy real estate agents which push housing prices beyond affordability.
Around where we are, there is now never a guide on how much the owner wants. Every advert is 'offers over $1.1' etc. or Auction.
At the end of the day, these houses are going for about $100k+ over that most times! It's ridiculous, and it's not as if the houses are nice or the block is big etc, most of the homes need major renovations.
When we first moved here houses were roughly $500k, that was about 5 or 6 years ago, as you can see, it's now double that and more. Wages haven't gone up near that much!
12-07-2015 08:31 #43
Have you ever gazumped someone in real estate?
They play buyers against each other and one REA who we spoke to when we wanted to sell our unit said that they always drop the price to get more interest at first, their is a specific price bracket which most people can afford, then when they put offers in, they try and get them to up their offers by saying things like 'do you have any family (parents) that would chip in a bit more to secure the property' - not those exact words, but he told us they rely on the married couples with no kids to purchase certain properties and then see if they have family etc to help them out.
I am not great at explaining what he told us, but hope you get my point.
Edit: when we spoke to another agent when wanting to sell our unit, we asked what our unit was worth realistically, his answer: 'I don't know, it depends how much someone wants it'.
We knew roughly what it was worth and what other places similar and in the area were going for, so we were happy to have a price bracket instead of 'offers over', but his answer confirmed to me that they just play the buyers and push them to their limit. They know that people get emotional when buying their first home or the home of their dreams etc. they use that in their favour.
Last edited by SAgirl; 12-07-2015 at 08:34.
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12-07-2015 09:18 #44
As an agent here lies the problem, when there is more than 1 buyer wanting to buy a home we are supposed to give each buyer the opportunity to buy, when multiple buyers keep increasing their offers, it excites the owners , who then ask the agent to get the best offer, which is our job, in a rising market the buyers are offering more than what the owner wants, the agent has to ethically keep all buyers updated - buyers get cranky if we ring them and say we have a higher offer but get even crankier when we don't ring them and sell it to someone else and then complain they missed out - what is the solution?
Even if the owner says I'm happy to take $500,000 - when another buyer offers over that what do you do? At this stage all offers are verbal and legally mean nothing until they sign a contract, so you take the first verbal offer, tell all the other buyers too bad, they get the ****s and abuse you and the owner could potentially miss out on extra money and the first buyer can still pull out? ( and if the first buyer does pull out the other buyers then accuse us of lying )
The only solution I believe is auction which is what we do , the buyers set the market, the buyers set the price, regardless of what reserve price the owners put on the home all buyers have the right to bid, stop bidding or go higher and all get the same opportunity - all done out in public , but then most buyers don't like auctions, why? Because they have to compete - which they do anyway !
As far as prices go I absolutely say to buyers - these are the recent sale prices of homes similar to this one but in this market we cannot predict what will happen at the auction, the owners will set their reserve price based on the feedback you give me - yesterday we had auction which was a prime example of market craziness and how hard it is to price property:
They bought the 3 bedroom house last February 2014 for $735,000 and are retiring so decide to put property on the market last month
We sold the 2 bedroom house next door to them in April this year for $850,000
Owner says I think I can get $900,000
78 buyers through in 3 weeks, offers ranged from $850,000 with the highest offer prior being $945,000
Owner adjusted reserve to $945,000( being the highest offer)
Sold yesterday with 9 registered bidders for $1,060,000 ( to the buyer who said he would pay no more than $945,000)
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12-07-2015 09:33 #45
Have you ever gazumped someone in real estate?
What ever happened to 'other homes in your area have sold between this price and this price, we figure your home fits into this particular price brackets. We suggest listing your house between eg. $500k - $530k (possibly with an expectation or hope of getting around $520k.
That way buyers who bid higher because *they* want to, is still fair.
With adverts like 'offers over $500k', I always (now) expect them to go way over that.
Last edited by SAgirl; 12-07-2015 at 09:37.
12-07-2015 09:42 #46
I've unfortunately as a seller had opposite experience. Lazy real estate agents charging a ridiculous percentage and trying to convince you to take the first lowball slap in the face offer so they can make their money and move on and sell the next house as quickly and as easily as possible.
But I'm in Adelaide and our housing market hasn't taken off as much.
I think all houses should be best offers by a certain date in sealed bids or auction. Then the advertised price should be one figure, the figure the seller actually wants. That way if a house has lots of interest people can do their best and final offer on paper and they will offer over the ask if there's lots of interest, or the vendor will get their ask price in the case of just 1 bidder. Or auction where people can see what others are offering and you can make an informed decision on the day but the advertised price must be the reserve so that the auction has a starting point.
12-07-2015 09:53 #47
Bait advertising is illegal in NSW and heavily regulated - they can't advertise offers over $500,000 if they don't have recent sales to support that evidence - if you find an agent doing that report them, we have to get audited yearly so they have to follow up on all complaints, the fines are $22,000 for each offence
As mentioned in my auction example yesterday, we sold the house next door for $850 so we, as the owners did, thought they would get a little more so they put their original reserve at $900 - the buyers were the ones who pushed the price up by $160,000 - no one would have predicted that!
12-07-2015 09:54 #48Senior Member
- Join Date
- Dec 2014
Kept phoning me with low offers and sob stories for the buyers " but they've had to borrow money to get to this offer." "But they're so young" blah, blah...
The last time I will ever be honest with how much we need to sell in a hurry to an agent. Obviously she just couldn't be bothered, knew we needed a quick sale. I ended up yelling on the phone "who are you working for us or them?" And threatening to rent the house out. (We were moving away) after that she finally worked a bit harder and we ended up with close to what we wanted. But I still think we could've got a better price through a more competent agent. Also, I felt like because we were moving away she knew we wouldn't be repeat customers and the buyers could be so she was all about them.
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12-07-2015 10:02 #49
The reason you can't say at the beginning of an auction campaign the owners reserve is $900 is because until the buyers start coming through the home we really don't know what their price feedback is - in a good market the price will go higher and multiple buyers offer $900 and start pushing the price up before the auction! Or in a falling market $900 might be too high, the buyers don't bother even coming to the auction and the owners might be desperate and would have reduced their reserve but because $900 was originally advertised it's already scared everyone away!!
12-07-2015 11:07 #50
But in auction if say the $900k was the reserve and it wasn't met, in SA the highest bidder can then negotiate with the vendor, so the fact it doesn't sell at auction also sets a price expectation, then the seller knows it was too high. And this is where I think it's the agents role to tell the seller what they think the minimum their house is worth, agents know the market and comparable sales, that's what I pay an agent for, their knowledge of all comparable sales, or what am I paying an agent for? If I'm not getting any negotiating skills or an agent willing to put their name on a minimum value, then 1.5% (or more) plus an auction fee is a lot to pay someone to advertise it, open it for a few hours a few times a week and take phone calls. I know there's a lot of hard work behind the scenes in running an agency and getting clients, but it just don't think sellers get value for money with auctions and an agent who can't put their name on a reasonable price.
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