A while ago I caught up with John McGrath, probably one of the most highly respected agents in Australia, on my weekly Real Estate Talk show and asked him what advice he gives people when they ask him “Hey, why hasn’t my place sold?”
Here is the transcript of that interview:
Kevin Turner: If your property hasn’t sold, there’s got to be some obvious reasons why, but when you’re in the middle of it it’s hard to work it out.
John McGrath: There’s three in particular that we look at as a business and we think price, presentation, and marketing are really critical.
At the end of the day, price is probably the most critical because even a property that’s poorly marketed and poorly presented, if it’s priced right, it will transact.
We think that pricing is so critical and ironically or perhaps paradoxically, to get a premium price you’ve actually got to start at a price that the market deems attractive an unarguable.
When we got out there, if we think a property’s worth 8 to 850,000 well of course we try and get the 850 plus but you’ve got to start in that 8 to 850 to really generate the inquiry.
Price is really critical and it’s probably the one that people get wrong most often.
Kevin Turner: When we’re looking at price, and we also talked about market segmentation, and one of the things we’ve seen over the last 12 months or so is we’ve seen that top end slow down a bit, so sometimes it could be a slowing market and it’s certain price segment.
Would you agree with that?
John McGrath: There’s no doubt that any marketplace is different price segments and different geographies.
At the moment we’ve seen Australia-wide, we’ve had a boom in the bottom end of the market of the first homebuyer, lower price stuff, and the middle and upper ends have been more or less sluggish.
You’ve got to be pragmatic and you’ve really got to look at in real time over the last 3 months properties in your price range and your area, what have they been transacting before because it’s no good saying the market’s good or the market’s bad because the only market that’s relevant to you and your sale is exactly the sort of properties that you’re going to be competing with.
Kevin Turner: If your property’s not moving you may have to sit down with your agent and ask them some really tough questions.
Put the shoe on the other foot, John. If you were a seller and your property wasn’t moving, what would you be saying to your agent?
John McGrath: If you’re a seller there I think you’ve got to go to your agent.
You’ve got to say to them “Look, we’ve now had it on the marketplace 60 days,” because I think any property that’s on the market 60 days in most markets it hasn’t sold and there’s a problem.
Ask for, look for, some constructive, practical advice.
One of the issues is often that agents don’t want to give clients what they deem is the bad news.
We don’t see it as good or bad news, but we see feedback from the market as really critical.
Perhaps the agent is trying to protect your feelings but by doing that they’re really not going to help you get your end result, which is the sale of your property at the best price.
I think you’ve got to encourage your agent to be brutally honest, Kevin, and really say to them “What are the two or three things we have to do to really get this property to move?”
Just ask them and run through price presentation marketing and say “Look, do you think it’s price? Do you think it’s the way that we’re presenting it? Are we not accessible enough to the public?Should we be doing open for inspection? Should we consider an option campaign? Do we need to put more dollars into marketing?”
Because again, a lot of agents go in and they don’t want to ask a vendor for a check for 1,000 or for 4,000 dollars for marketing but often that’s the answer to generate the buyer inquiries and to generate the sale at a premium.
You’ve really just got to drill into the three or five chips and just look at each one of them a little bit forensically and try and be objective and say “Which one of these elements do you think we are out of the picture on?”
Kevin Turner: John, thank you very much for your time.
John McGrath: Pleasure, Kevin.
Listen to the full show at RealEstateTalk.com.au and while you’re there subscribe and receive our weekly podcast (or the transcripts) where I interview Australia’s leading property experts.
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