Many properties which are for sale by Auction are not advertised with a price guide. However, usually when a buyer calls or asks the agent at the Open for Inspection, the agent will suggest a price range or at the very least give a sheet of recent sales in the area as comparables.
There are several agents out there however, who practice a very bad habit of not disclosing any price guide at all – even at the Open for Inspections! There are several reasons why these selling agents use this approach:
- They are not familiar with the pulse of the market and genuinely don’t understand property values. These are not very good selling agents and sellers should stay away from hiring someone who cannot accurately quote a price range and provide justifications for it.
- The agents may not be local to the area – hence they can only rely on databases and not on intimate neighbourhood knowledge. Sellers should always try to use agents who are familiar with their area.
- The agents are being opportunistic. Selling agents know that buyers (unless they are using a buyers’ agent!) are at a disadvantage when it comes to having access to market information. By intentionally not revealing a price guide, the agents are hoping that an overseas buyer or someone not familiar with the area or sales prices would make an offer which is higher than appropriate.
If you are looking to sell your property, you want to make sure that the agent you appoint gives an accurate reflection of prices to your potential buyers. By not indicating any price guide at all, the selling agent may actually alienate potential buyers.
The reality is that sellers and their appointed agent have an agency agreement (a contract). In this agreement, the selling agent must always indicate an appraised value. Therefore, there is absolutely no reason why a selling agent should just say that they are ‘waiting for market feedback’ or any other similar excuse. Selling agents always know what the vendor wants for their property – they just don’t always want to tell buyers!
As buyers’ agents, we have access to the same databases as the selling agents. So this type of approach does not deter us. OH Property Group agents are regularly invited by selling agents throughout Sydney to inspect properties and give an opinion on market value – because selling agents know that our agents understand value and view a much broader range of properties for sale than any selling agent (who cannot easily view properties for sale by a competing agent).
About Oliver Stier
Oliver J. Stier is the Director of OH Property Group, a leading Sydney buyers agency. He studied Quantitative Economics and Finance at Cambridge University (UK), University of Toronto (Canada) and Princeton University (USA). In addition to being a licensed real estate agent, Oliver also holds the Chartered Financial Analyst (CFA) designation.