Advice for the Seller

ADVICE: SELLERS

GIVING A MANDATE… IT IS YOUR CHOICE!

YOU always remain in control of the process when selling YOUR property! In terms of the mandate given to an agent to market and sell your property, there are mostly three options available to you, each with its pros and cons:

SOLE MANDATE: One agency is given the exclusive right to market and conclude a sale of the owner’s property within a specific period of time and is based on an instruction and agreement between the seller and the estate agency. The time period for a sole mandate depends on the area and the type and price of the property and the activity levels in the market at any given time.

DUAL MANDATE: Two or three agencies are given the right to market and conclude a sale of the owner’s property. The agency that sells receives the associated professional fee.

OPEN MANDATE: Many agencies are given the right to market and conclude a sale of the owner’s property. The agency that sells receives the associated professional fee.

In practice, sole and open mandates are the most common. Following is a quick summary of the benefits of a sole mandate compared to an open mandate:

SOLE MANDATE	OPEN MANDATE
Personalised and focused marketing and advertising plan, including show days, weekly advertisements, etc. supported by a generous marketing budget	General marketing and exposure of property supported by a shared marketing budget
Interaction with a single agent who is determined to fully understand your needs	You have to repeat yourself in explaining your needs to many agents
Greater chance to realise your selling price due to BUYERS competing on the property	Price often compromised due to AGENTS competing on the property
Consistency of price ensured	Price confusion in the market due to buyers seeking out the agent that offers the lowest price
Agent accountable to you for results due to contractual agreement	Less accountability
Very small chance of any commission dispute	Risk of commission disputes and seller becoming liable to pay double commission
No over-exposure of the property as advertising and show days are controlled	Risk of over-exposure of property due to many agents advertising the property
Peace of mind	Security risk

PRICING YOUR HOME TO SELL

The most important aspect of selling your home is getting the pricing right on your property. The right price will ensure that your home spends less time on the market and attracts the right buyer. Before talking about price though, it is important to understand a few key principles to keep in mind when considering and determining price, the most important of which is that THE CURRENT MARKET DETERMINES THE VALUE OF YOUR PROPERTY.

In other words, the value of your home is determined by what a willing and able buyer is prepared to pay, given a certain set of circumstances. If the price is too high and the prospective buyer does not find the value compared to the prices of similar competing houses in the area, the house will not sell.

Therefore, the market value of your property IS NOT

what you paid for your home;
the amount that you need to purchase a new home;
the price you would like to achieve for your home;
necessarily the value agents put on your property; or
what a valuator says your home is worth.

Market value is determined by the current market.

Current market considerations

Even though there is evidence of many willing buyers in the market, the number of able buyers has decreased significantly due to current global economic pressures, the National Credit Act and the stringent lending criteria of financial institutions.
The continuously rising cost of living has resulted in many homeowners no longer being able to afford their properties, resulting in an increase in available properties on the market. The market is therefore increasingly competitive and qualified buyers are spoilt for choice.

The pitfalls of overpricing

Be aware of over valuation because it can damage the sale of your house.

An unreasonable asking price discourages prospective buyers.
Buyers purchase by comparison and if the property is priced above similar competing properties, it will eliminate offers.
A property that is priced too high will stay on the market too long leading to over-exposure.
An overpriced property limits financing.
It eventually means a lower price.

According to the FNB Property Barometer Report published in November 2011, the average time for properties on the market is currently 19 weeks and 85% of sellers had to drop their asking price by an average of 12%.

Getting it right

The correct method to price a property is to use a Comparative Market Analysis (CMA). This determines the value of a property in comparison to other comparable properties which have recently been sold or are currently for sale. Your agent should assist you to set the correct asking price for the property in terms of the current market conditions. The ultimate pricing decision resides with the seller, but your agent has the duty to present you with the relevant market facts.

PREPARE YOUR HOME FOR A SUCCESSFUL SHOW DAY

A show day is an excellent opportunity to help sell your property faster. Read our list of tips to make the most of this opportunity:

Outside the house

First impressions last. The first impression for the buyer is the garden and the outside appearance of your home.

Mow the lawn and ensure that garden tools and hose pipes are neatly packed away.
Ensure that your swimming pool is clean and sparkling and that all water features are operating.
Spend a little time to ensure that exterior walls, woodwork and gutters are in good repair.
Make your braai and entertainment areas attractive.
Make sure your front door invites visitors in.

Inside the house

Make it as bright and light as you can. Switch on the lights if necessary and open all the curtains to ensure ample light in all the rooms.
Make sure that bathrooms are clean, towels hung up neatly and all products packed away.
Baths, basins, toilets, taps and showers must be shiny.
Kitchen, stove and oven must be sparkling clean and all dishes and washing packed away.
Pick up all toys and pack away any items which make the rooms feel cluttered.
Pack away any clothes lying and hanging around.
In summer, open doors and windows as far as possible and allow light and fresh air to circulate.
In winter, make your home warm, cosy and inviting.
Make sure that visitors can view all the outbuildings.
Put fresh flowers in a vase on a prominent spot.
Play classical music to create a pleasant atmosphere.
If possible, try housing pets elsewhere for the day.
Do not hang about and make sure that family and friends are away during show times – it allows prospective buyers to be at ease, unobserved, comfortable and free to voice their feelings.
Lock away all valuables.