In recent years the commission of estate agents has been a point of contention, especially within industry circles. In the past few months it has certainly risen to the fore again as a product of economic circumstances which has influenced the demand and value of property in certain key markets, like the major metros and surrounding areas.
In a buyers market like we have in most areas now, you need to use an agency to sell your home who is going to get you the best price. That means using a skilled agent who has a full array of marketing tools to best present your house to buyers.
Often sellers who are attracted by low commission, end up getting a lot less for their home than they expected. The difference in commission is often far less than the difference in the price realised from the sale. You pay for what you get.
There are multiple factors that have to take into consideration. What is of utmost importance is that a company like Harcourts offers clients an entire spectrum of services that usually are not included by low commission agents. Also, the quality of professional training provided to staff gives the customer the benefit of the best service and marketing available, international highly advanced systems and incredible market insight due to internal communication channels.
It is imperative for the seller to understand that agents earning less commission have to turn over more properties to make their business viable, therefore they are often unable to put a sole focus on your property. This is similar to the discussion of a sole mandate, which almost always benefits the seller to a greater degree because the agent can focus their attention on finding the perfect buyer at the right price because they have been given the space and opportunity to do so.
We're finding that economic reasons put the most pressure on commissions as opposed to market competition. As certain areas of the market are under tremendous strain it puts pressure on the desired return for the seller and landlord and many times they look to the agents' commission to make up the difference. However, if the agent is trained correctly and offers the client undeniable value, clients tend to understand the necessity of commission.
At Harcourts training is a part of our culture. We have the Harcourts Academy which schedules, almost weekly, training sessions nationwide to ensure our agents and business owners are kept informed on cycles, trends and the latest technologies to further assist clients to receive the best possible service. Understanding the evolution of the market is a big part of that training. We regularly engage with past and present clients and gain their perspectives and so we are able to retain a strong grip on what the client expects. In that way we stay competitive and focused on the primary goals.
Harcourts Africa Chief Executive Officer