Getting the highest price through conjunctional agreements

Summary:

If your apartment is listed with an agent, you may be curious if a different agent could get you a higher price, or you may discover that they could, and you need to know what you can do about this.

Unfortunately, if you find yourself in this situation it is very difficult. This is due to policies some agencies have in place to stop conjunctional agreements happening.

If the agency you have chosen does allow a conjunctional agreement, it can mean a smaller commission for the agent you have signed with, which may end up costing all involved more.

Here at Apartment Specialists, we don’t agree with this policy, and we allow other agents to sell the apartments we list as well, as we believe that we can get the highest price and owners are getting the most out of the market. This allows the owner to be in control.

TRANSCRIPTION:

Andrew Murray, Apartment Specialists, today we are talking about the Auckland apartment market and what happens when you are an owner who has listed their apartment with an agent, but has in the back of their mind - I wonder if that other agent can get a higher price?

There are many different agencies and agents, especially in the Auckland apartment market. So, what if another agent can bring in a higher price when you are already listed with someone else?

Unfortunately, in most cases, that agent will not be able to take a buyer through. Or if they do, it's very tricky or not financially viable. There are agencies in this market that have policies in place where they will not do any conjunctional agreements with other agents. Or at best, it will only be a referral. Some agencies will do conjunctionals, however it will be at a reduced commission rate. It could be 30%, maybe it's 40%, maybe it's 20%. What happens in this case is that the agent with the good buyer may be put off due to that reduced commission they could earn from the sale. In this situation, it is the vendor who misses out. This is a problem.

What we have put in place to change this problem is to say that any agent from any agency can sell your apartment with an equal commission split. It doesn't matter if it's listed with a list price, by tender or by auction. Any agent in the whole of Auckland or New Zealand is able to sell your apartment when you list with Apartment Specialists. The reason we do this is so our owners know that they’re getting the most out of the market. The reality is a lot of other agencies will have policies that don’t allow other agents to sell their listings. As an owner you can take charge. If you choose to go with an agent where their agency has this policy in place, request that they change it. Ask them to please let other agents from other agencies have the ability to sell the apartment if they come across a good buyer and ask them to give them an equal commission split after expenses if they do. Request that they write this in the advert for the listing so the other agents will know. An agent should do this for you. I don't see why they would refuse because it is in the best interest of the owner. Make sure to take control because you are the boss. You are employing the agent. You've got to put these terms to the agent if they don't put them to you. Put yourself in control. I hope this helps.

Next time I will be talking about what sales method you should choose to sell your apartment and how to decide which is best - auction, tender or listing with a price.

Thanks.