There are now many estate agents partnering with auction houses – but many more who aren’t offering property sales by auction than are and I’d like to address that.
As sales people we selfishly want to get the sale – for ourselves and for our vendors – and we also want to give our customers choice. But how do we achieve this best of both worlds? In my opinion, it’s through partnership.
I’m pretty sure that most agents reading this article won’t have read the ‘RICS professional standards and guidance, global real estate agency and brokerage’ document, so let me highlight an important section:
“There may be a number of different methods of sale that can be adopted for the sale of a property. You should undertake careful consideration of the most appropriate method and your recommendation to the seller should depend upon the circumstances of the property, the market and your client. You should obtain legal and/or tax advice where appropriate.”
A compelling argument, I believe, for partnering with an auctioneer. Doing this doesn’t mean they need to offer every property by auction, but at least they will be fully informed of all the options and in a position to discuss all methods of sale with the vendor. It’s offering that choice that will set them apart from other agents the client may speak to.
MAKE IT A WIN-WIN SALE
Now, obviously estate agents are ideally going to want every sale for themselves. They want to list it on their agency’s books and take that full commission. And in most cases I’m sure that will still happen. But with fluctuations in the property market each and every year and with the motivations of our sellers changing each and every day, offering an auction sale makes not only the agent’s life easier but also the vendor.
All kinds of property can now be sold by auction. Listing to completion can be achieved in six weeks. Be part of the story!
Let’s take things back to basics, the auctioneer/estate agency partnership should be win-win for both sides. The estate agency can use the auctioneer to offer – and ultimately sell – their vendor’s property under the hammer. They receive a fee split on the sale and they maintain the relationship with their vendor. For the auctioneer, they get an extra lot for their online or room auction and they get to expand their services within the property sector.
All that said, estate agents are still reticent about partnering with auctioneers. If a property is in bad condition and needs modernisation, it’s seen as an auction-style property – something you’d see on Homes under the Hammer – and isn’t something an estate agency necessarily wants to display in the windows of its high street branch.
Actually, those days are behind us. All kinds of property can be sold by auction, it’s predominantly based on the motivation of the buyer or the seller, not the condition of the property. Therefore if a modern property has been on the market for six months and the vendors are desperate to sell, a secure auction sale will get them moving.
Every estate agent I’ve ever met – including me – will commit to vendors to get a sale for their property. Of course that’s not something we can guarantee, at least not before an auction offer is agreed anyway. Then the exchange of contracts secures that position.
We know how important the security of sale is and so we have built this into our partnership proposition.
We recommend that all our vendors produce a legal pack even though it isn’t a legal requirement for a conditional sale. By providing that information up front it helps to minimise fall-throughs and completion delays later down the line as there are no surprises. In fact, we offer a no sale – no fee deal on legal packs to clearly lay out our commitment to our vendors.
It is encouraging that initial due diligence by both the seller and buyer that helps us secure a sale and push it through to completion. In most auction sales that listing to completion period can be as short as six weeks. An impressive duration when you compare it to the latest RICS Residential Market Survey which reported that the average time from listing to completion has reached 19 weeks, the longest since the survey began in February 2017.
Plus, with a commitment on the fall of the hammer – physically in the auction room or digitally via online auctions – our fall through rate is less than one per cent.
Are there any estate agents who wouldn’t want to be part of that success story?