What Do Real Estate Agents Do in Sydney and NSW? Revealing the Truth

1. The Role of a Real Estate Agent

What do real estate agents do in Sydney and NSW?

Why do real estate agents exist? Well, here's one major role of the agent that no one really thinks or talks about. We provide a degree of separation from your sale where emotion towards your property is taken out of the equation. Like when it comes to selling anything, we understand you love your home more than anyone else on the planet. That statement carries a lot of weight. It’s yours, and you’ve made it just how you like it!

Thus, it can be very easy for emotion to creep into the deal. This can affect anything from the price a property is listed to even potentially getting offended at a purchaser’s offer. This happens often whether the offer is sensible or not. Picture it for a moment; there’d be a lot more properties apparently worth $10M on the market, wouldn’t there? And we don’t even want to imagine the Auction Clearance Rate.

2. The CMA

Comparing the Market

So, with that out of the way, let’s start from the top of the sales process. What do real estate agents do here? Once a potential seller brings us in, the first step in the process for us is to conduct a Comparative Market Analysis. This is known as the "CMA" for short.

This is how we determine the likely value and best listing price for your property. We use a mix of our knowledge of the local market and comparable properties that have recently sold. We write up a detailed report to you an accurate picture of what buyers are paying for properties like yours. Included is a carefully selected list of sold properties in close proximity that have similar features and offerings to yours.

This is something many homeowners could do themselves with enough market knowledge. Though with the speed the market can evolve in certain periods, you might feel a bit more like a stockbroker.

There’s also the pitfall some homeowners fall into of comparing against properties and streets that aren’t quite what we’d call comparable. If this happens, it can be very easy to get the wrong idea. As the cliché goes, a property is only ever worth what a buyer will pay. By doing a CMA, we can see in black and white what they’re paying for properties like yours right now. We call this "the hard evidence", and we’re legally required to provide this to you.

3. Uncle Lewie - Market Expert

Uncle Lewie, The Butcher turned Market Expert

Before we go any further, we’ve just covered one of the biggest sticking points for potential vendors: the price.

I'll allude to the point about separation and emotion towards your property. What we'll cover now is the fictitious character all real estate agents hold dear to their hearts. Uncle Lewie. So who is he?

The conversation with homeowners at appraisals

To explain this, we must tell you how the conversations go with homeowners during an appraisal. Enjoy the insight!

1. We're given a grand tour of the property
2. We sit down to present our CMA report
3. We get to the point of our price opinion
4. The homeowner has a strong opinion on what we've said, and we're told why it should be much (much) higher.

Even the hard evidence isn't safe!

Believe us when we say the difference between ours and the homeowner’s opinions can be anywhere from the hundreds of thousands, and yes, even a million or more. It happens all the time!

A quick note

So, this is why most agents giggle to themselves when we hear the age-old statement: "But guys! It's the Real Estate Agents driving up prices!"

Well, let us be the first to tell you. About 98% of the time we're wrestling with the price opinion, praying it might get somewhere realistic! To quickly touch on the truth, the only thing that can drive the market up is buyer demand, competition, and what they're willing to pay. Especially at Auction, no one is telling them what to do. Nothing can change this, but that's another post!

So how does this happen?

How agents feel sometimes

Now, we always ask the homeowner how they concluded on value, and we’re usually given one of two answers:

• “Another agent came in and did this *looks around* and then said, "Yep, you’ll get the price YOU TOLD ME we wanted all day, every day”."

Yeah, that's a real quote from a homeowner.

We’d then ask if that agent showed up at the door with the same level of proof we did. The answer is usually either a hard “No”, or if they have, they’ve cherry-picked the comparable properties to mislead you into giving them your signature… All the time.

Don't worry. We can hear you in the back: "See, guys! It's the Real Estate Agents driving up prices!"

Unfortunately, you can't trick buyers into paying more than the property is worth. In these cases, that agent is most likely never selling that property. If they do, they've got a VERY unhappy client after all the price reductions. You know, bringing the price down to where the agent knew it would sell from the beginning.

We call these listings "overpriced turkeys", and they exist because that agent didn't know how to lie twice. Should have just been honest from the start!

Ok fine, you've made your point. What about Uncle Lewie?

Ok, so the second answer we get is often this:

• “We’ve spoken to our friends and family, and they believe the price should be XYZ”

When we ask, "Which family member and are they an agent?" we're often given something quite comical:

• “My uncle who’s a butcher with a shop down the road, and he’s quite confident in his figure”

At this point, we're throwing in the towel while thinking, "Know what? That's fair, we get it. We all have that family member". Especially if you’re Mediterranean like us, you know the one. He’s at all our family gatherings, always covers precisely what the market will do over the next ten years, and knows exactly what your home is worth with god-like accuracy.

Allow us to introduce the man, the myth, and the legend we call Uncle Lewie. Uncle Lewie is why we exist.

If you have an Uncle Lewie, we’d love to hear about him in the comments. He also may be a stock and cryptocurrency expert with a law degree.

4. Help with Staging

Property with staged furniture

Ok, we’ve taken our best crack at providing an opinion on fair market value. Next, we'll help you with actionable tips and strategies to stage your property. It's important we're in the best possible condition for open homes and photography. We’ll provide insight into what may or may not be worth your money, time and energy to repair, alter or upgrade. This is an important insight as it can be easy to overcapitalize on renovations. This is possible because there is a tipping point where you may not always make a profitable return depending on the property.

5. Devising a Marketing Package

Advertising Campaign

At this point, we’ve got a pretty good idea of your property’s highlightable features. We assemble a bespoke marketing package at a sensible price to suit your property value. This is where we’ll capitalize on all those great features that will guide your purchasers down the pathway of falling in love with the property as you have. These marketing packages include listing on portals such as realestate.com.au and Domain, social media, professional photography, walk-through videos, physical paraphernalia that purchasers can take home with them, and more.

Once your property is ready to list, we'll send a preview of your listing. We want to ensure we haven’t missed anything you love about the property. From here, we’re ready to start marketing it to potential buyers through the chosen platforms in your marketing package.

6. Obtaining the Contract of Sale

As we’re putting all this together, we’ve organised the creation of the Contract of Sale from your solicitor or conveyancer, and if you haven’t got one yet, we can refer you to one of our preferred partners.

7. Open homes

What does a real estate agent do at open homes?

So we’re on the market; now it’s time to make the property as accessible as possible to potential purchasers. We do this with open homes and private inspections. So what do we do here? Well, it’s more than just opening the door and handing out flyers to buyers. We ask various qualifying questions to gather critical information like:

• Where did they see your listing?
• How long they’ve been in the market?
• Have they missed out on anything recently?
• Are they in a position to purchase regarding their finance?

This is a critical step as it’s crucial to get an idea of:

• Which platforms are working best for us
• Who your successful purchaser might be amongst them
• How motivated or far along they are in their journey.

We also ask for their feedback on your property and price. We take this into account to ensure we aren’t listed too far above or below the market value. It’s important that we represent good value to keep the property attractive and ensure a smooth and timely sale.

Purchasers can be too afraid to make an offer if we're priced too high, or your open homes may be empty. Your time on the market will be extended, or you may even miss the boat entirely in a changing market. Remember, buyers do a CMA in their minds every day they look at properties. If they see another property right after yours offering similar features but is priced where it should be, they will know where the value is.

My favourite scary quote with a hefty dose of reality is, “You’ll actually be helping other properties sell”.

8. Buyer Callbacks

After each open home, we’ll do a call-back session to contact all purchasers who came through the day before. We also spend some time getting in touch with those who had a look the previous week. Buyers look at many homes along their journey, and they all meld together at some point. It’s important we stay top of mind, or else they could forget us!

9. Negotiating offers

If we’ve done everything correctly up to this point, we’re likely to get an offer at some point. When an offer comes in, we'll help you evaluate it and negotiate the terms of the sale. We’ll let you know if we consider the offer sensible and worth considering. We'll know by taking into account the current level of feedback and how the campaign has been going thus far.

Cutting back to Uncle Lewie, this is where he’d be having a tough time selling the property himself when he inevitably gets offended that the purchaser forgot to account for the extra sentimental value provided by Uncle Lewie’s water fountain that hasn’t worked since 1986. At this point, he’s chasing the poor buyer down the street with his meat cleaver! Once again, Uncle Lewie is why we exist.

10. The Man in the Middle

Awaiting the cooling off and settlement periods

Once an offer has been accepted, we usually take care of the signing and exchange of contracts before entering the cooling off and/or settlement periods. During this time, we correspond with the solicitors or conveyancers to ensure they have everything they need to solicit the sale smoothly. We’ll also ensure the successful purchaser has everything they need to finalise their finance to purchase their new home.