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Few excuses for high days on market numbers

Few excuses for high days on market numbers

by Reporter 2 comments

Simon Parker and Matthew Sullivan

There’s few excuses for agents burdened with high days on market numbers, provided they have an open relationship with a vendor and have set the listing up correctly from day one, including an accurate price estimate, a number of senior industry professionals have claimed.

Their response follows up on the results of the inaugural Real Estate Business Sentiment Survey, which found 44.7 per cent of the 358 respondents expected days on market to rise in their area over the final three months of this year.

“I think the industry, and the practices of sales people have a lot to do with the blowout in days on market,” Mike McCarthy, director and CEO at Victoria-based Barry Plant, told Real Estate Business.

“I think if people are setting listings up correctly, communicating with their vendor correctly, marketing the property correctly, and giving them open and honest feedback, then if the vendor is working with the agent and is realistic about the outcome, then the days on market shouldn’t be blowing out to massive figures in most locations.”

“If I look at the better performing agents [in Barry Plant], even in private sale areas, they are still achieving days on markets of 27-28 days.

“What they’re very focused on is the process, and setting it up correctly from day one.”

This includes establishing a realistic “price range”, he said.

“It’s saying [to the vendor], we’re not here to put a price on your property, we’re here to work with you to market the property, attract as much interest as we can, negotiate the best price, and, yes, based our experience the price will be in this kind of range.”

“The market, whether it’s going up or down, can change very quickly.”

“That’s why we say to our [agents], don’t tell them what you think you can get, because your opinion really doesn’t matter at the end of the day. They expect you to have an opinion, but we talk in price ranges, that, for a property like yours, we think something based on current market, what we’ve sold, what’s on the market currently, what you’re competing against for similar properties, is in the range of $600,000 to $650,000 [for example].”

Starr Partners CEO Douglas Driscoll agreed, citing similar low days on market figures for franchisees within his Sydney-based group.

“There is no point flattering the vendor’s ego,” he told Real Estate Business.

“We need to realise in a toughening market we are the experts and vendors should really take our advice. They [vendors] have called us out for a very good reasoning to sell their property, so first and foremost the price has to be spot on.”

A well-targeted marketing campaign is another must, he said.

“So rather than just doing what I call a ‘scattered market’ approach, be a bit more tailored and specific.

“[For example], if I was dealing with an acreage property with equestrian facilities, rather than just sticking it up on realestate.com.au you might look at specialist magazines.”

He said regular price reviews were also a way to get listings sold.

“This is where you have a sales strategy and you draw a line in the sand to say to…the vendor, OK, we are going to try this price, use this, that and the other in terms of marketing, and as of this date – which might be two weeks down the line - if the property hasn’t been sold or hasn't generated any serious offers or interest, we will review it again and bring it down to this price.”

“Give the vendor honest feedback. It isn’t the agent that is saying it, it’s the consumer at large because they are the ones that are actually going to part with the money.

“To an extent it is absolutely irrelevant what the vendor thinks or what the agent thinks, it is not them that buys the property.”

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Few excuses for high days on market numbers
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