I’m sure everyone has heard the pros and cons of open listings, but the question is, does it work in a tough market? The idea behind open listing your property is that you give all the agents a chance to sell or lease your property and it opens the property to all of those agents’ potential clients. Correct it does, however there are two main things that in a tough market don’t help you as an owner when having an open listing.
As each of those agents are now competing against the other agents to do the quickest deal their focus is not on achieving the best price but now its all about beating the other agents and then talking the clients into doing a deal. When there is multiple agents a potential buyer ask each agent what the listed price is, whilst they should all be the same, it only takes one agent to say the phrase “I can get you a deal” or “I can get it for less” and that’s when you have lost your potential to achieve the highest possible price.
I commonly explain the scenario like this. If you were going to buy a Holden Commodore and there was a whole bunch of dealerships selling the same model you wanted. You are going to go from one dealership to the next until you find the dealer who is going to sell you that specific model the cheapest. Well, when you have multiple agents signs up out the front of your property the potential buyer or tenant will ring each one until they find the one who will screw the price down for them the most.
The other main reason is that most agents won’t go through the ideal sales or leasing strategy including marketing or pricing as they just want the listing to get more enquiries whether that is for your property or the next. There is no control from the vendor nor any requirement for that agent to provide you with ongoing feedback on enquiries, inspections or market changes. In this scenario you might as well stick your own sign up because you’re paying an agent to take a phone call. If it’s a million dollar property that’s a $30,000 phone call.
Be smart about the sale of your asset and choose an agent or agents that provide ongoing continual feedback to keep you educated and a guarantee that if they don’t then you can terminate the agreement. Accountability is key to a successful sale or lease campaign.
Phil Grant – Director Commercial Sales & Leasing
NAI Harcourts Pinnacle