Buyers have an uncanny knack of being able to sniff out trouble and if they think they can smell blood in the water, will very often move in for the kill. Property auctioneers have gone to great lengths to point out that not all property that goes under the hammer is the result of financial distress. But if truth be told, for many the perception remains that if a property is being auctioned it is because the seller has become desperate and needs to sell urgently.
People watch the property market far more intently than most think and will actively discuss which properties are on the market in their neighbourhoods. Think about it, how often have you heard about someone whose property has been on the market for months and months? Neighbours seemingly know all the answers and apart from knowing that their own property is worth far more, relish the fact that the property, despite the number of agents marketing the home, has failed to sell.
One of the potential solutions to resolving this issue is to give a specific agent a sole mandate. However, a survey conducted on behalf of Private Property by Columinate, an online research company, revealed that only 11 percent of the 400 individuals polled believed that utilising the services of only one agency ensured that the seller would receive personal attention. In direct contrast, 48 percent believed that having more than one agent promoting the property actively increased the chances of it selling.
Real estate companies have been trying to sell the sole mandate concept for years and with good reason. In theory, it is a win-win situation for all. The seller receives the undivided attention of the agency marketing the home as it is in the agency’s best interest to punt the property as much as possible. The agency on the other hand, has the exclusive rights to market a property and with this vested interest in hand, will go all out to ensure that the property is viewed by as many of its potential buyers as possible.
With all these benefits, one would think that sole mandates would be the norm, but strangely enough many South Africans remain resistant to the concept. The adage less is more does not seem to feature and overall the feeling is that the more agents they have marketing the home, the greater the chances of securing a sale.
For some reason, sellers often believe that agents will do anything to secure a commission and this includes pressuring sellers into lowering the price in order to secure a quick sale. One of the people who responded negatively to the sole mandate argument said as much stating, “What if I don’t get the best deal from the sale of my property? Competition is always good and ensures that agents who are picked to sell the property will work hard and honestly.” The competition aspect appeared to factor quite strongly in the survey and 14 percent of those interviewed believed that granting a sole mandate to one agency limited the number of buyers viewing the home.
Surprisingly, only two percent of the respondents believed that selling a property via the sole mandate route created a better perception of the property. Nevertheless, one of those polled stated that a sole mandate retained the exclusivity of the property saying, “If a dozen estate agents are marketing your property – it gives the impression that there is something wrong and it is difficult to sell the property.”
Once again it seems that educating buyers and sellers is the key. Sole mandates do work when the property is correctly priced and the chosen agency has all the right tools at its disposal to ensure that the property is showcased to its full potential. Overpriced homes do not sell in the current economic climate, whether by sole mandate or otherwise and no agent worth his salt is going to try and secure the exclusive rights and go to the added expense of trying to market a home that he knows has little chance of selling.
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