A guide on how to sell your home
Deciding to sell your home is a big step that almost always comes after some deep thinking but the decision is only the start of many choices you will need to make throughout the process.
The first is the matter of using a professional agent. Should you use one? Which agency do you choose? And do you opt for only one?
The experts offer some helpful advice:
Getting that first valuation
Roger Hoaten, managing director of Seeff Berea, suggests you start by seeing which agencies specialise in your area and how much of a footprint they have.
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“Choose an established brand with a track record in the area.”
He adds it is “always a good idea” to get a few agents to come and view your property and give you a professional opinion on the value.
Choose agents from well-known companies that are active in your area, agrees Berry Everitt, chief executive of Chas Everitt International.
“Real estate companies with strong brands are generally also the ones with the most resources invested in supporting their agents with excellent training and business systems, providing their customers with superior marketing and referral systems to ensure the property receives maximum exposure to potential buyers.”
Choosing between the agents
Everitt cautions against selecting an agent based solely on the estimated sale price they give you.
Rather, you should consider the professionalism an honesty of each agent, whether you have a good rapport with them, the reputation of their company, their proposed marketing plans and, most of all, the basis for their estimated selling price.
“This should be based on a thorough knowledge of current market trends in your area, buyer demand and a comprehensive market value report that will help you to set a market-related asking price.”
The estate agent who presents the most comprehensive market analysis, and has a track record of similar sales in the area, should be the one you opt for, says Hoaten.
“Guard against being swayed by charisma and the promise of a high price...”
You should also ensure the agent you choose is properly qualified and in possession of a valid Fidelity Fund Certificate, Hoaten says.
Sole or open mandate?
Many sellers believe if they let multiple agencies market their home, they will increase their reach to potential buyers and sell more quickly. But this is not the case, says Adrian Goslett, chief executive of Re/Max of Southern Africa.
“The truth is, it is often far more effective to sign a sole mandate and allow one agent the space to secure the best sale. While the threat of Covid-19 still exists, a sole mandate is also a safer option because sellers will have to liaise and deal with only one agent rather than several.”
Hoaten agrees: “With a sole mandate, the seller avoids the risk of a cluttering of listings on the property portals often at varying prices. Buyers also usually overlook multiple listings.”
Furthermore, working with one agent means the agent can focus all their energy and marketing on your property for a specified period. You can also avoid the risk of multiple agents trying to close the deal at any cost.
“A sole mandate minimises the risk of double commission and confusion about who introduced the buyer.”
Everitt says while sole mandates have many advantages over open mandates, the main one is it is more effective to have “one message” about your property going out to buyers from one agent.
“Having a number of agents hawking the property can easily make it look as though you are desperate to sell and result in your receiving lower offers than you should. In fact, we believe that the more agents you have working on your property, the lower the eventual selling price will be.”
Also, he says, agents working on an open mandate often end up inadvertently working for buyers rather than the seller, in that they might try to get the seller to lower the price so they can take that to prospective buyers and secure the deal, rather than getting buyers to try to increase their offers.
Listing for the right price
A correctly priced home will match the prices of similar homes in the area, Everitt says, adding that while the pricing of the property is your decision, you should take into account that agents have put a price together using a variety of tools and area knowledge.
“If you are unhappy with your first valuation, it’s a good idea to get a second opinion.”
• How low should you go?
If your property has been listed at a marketrelated price, Hoaten says it should be appropriate to accept 5% to 10% under this price, depending on how the purchase is to be financed.
“Cash is worth a discount based on the certainty involved,” he says.
If you picked your agent correctly, and applied the science of setting an attractive asking price for the property, Everitt says you should not be getting offers that are much lower than that.
“The FNB Property Barometer puts the average difference between asking and selling prices at around 10% but, in our experience, it is much lower than that where the seller has properly considered the ‘competition’ – that is, what similar homes are for sale in their area and their asking prices. You never want to be the most expensive offering.”
Navigating a bidding war
On the other hand, if your asking price is right, he says, you may even get competing offers from more than one buyer, and actually end up getting more than your reasonable asking price.
If you are fortunate enough to have a few buyers making offers to purchase and the offers are similar, Hoaten says you should determine how the sale will be financed. As general rule, cash is first prize. This is followed by the buyer with the highest deposit and bond and then pre-qualified buyers on a 100% bond.
Everitt adds: “Your choice should come down to the offer that contains the best terms to suit your personal situation and relocation plans, and no other suspensive conditions, such as the buyer needing to sell their own property before they can finalise the purchase of your home.”
Could the sale still fall through?
Yes, this is possible in a number of scenarios, according to Hoaten. “The buyer could breach the agreement or their finance application could be unsuccessful. The buyer could also become ill or have an accident. Under certain circumstances, the bank could withdraw a bond that has been granted.”
The chances of a sale falling through are around 14%, Everitt notes.
Other reasons include:
• The buyer failing to get a big enough bond.
• The bank giving a lower property valuation than expected for a bond and the buyer being unable to pay cash to make up the difference.
• The buyer getting retrenched after being pre-qualified for a home loan and the bank reconsidering its offer.
• The buyer's own home sale falling through.
• The sudden death of the buyer.
However, he says, a good agent should be able to find a replacement buyer within a short time.