The Pricing Dilemma - An Agent's View

Published 08 December 09 09:18 AM | Peter Mericka 

OPINION
by Chris Warren
Licenced Real Estate Agent
Chris@RemaxColonial.com.au

 

Chris Warren is a Licensed Real Estate agent with over 20 years' experience, providing real estate services to consumers on Brisbane's inner southside. He was recently quoted in a submission to the Estate Agents Council of Victoria concerning real estate agent appraisals and the pricing of real estate, and wrote this article in response to a request for his opinion on the problems associated with the valuing and pricing of real estate.

Recently one of our sales staff asked us all to view a property she was hoping to list.

The owner was present and indicated to us he was getting a number of agents to look at the property and he would list with whoever gave him the best price.

For the rest of the day our sales person was chasing our opinions on what we thought would be the best price that could be achieved.

Absolute insanity, I thought once again!

What kind of business relationship could this owner and agent have based on such a pathetic unprofessional approach?!

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Filed under: Valuation, conflict of interests, transparent, valuer, appraisal, real estate valuation

Comments

# George Rousos said on December 8, 2009 4:19 PM:

To All Agents

It is strongly advised before giving a market opinion, that the following information on regulatory pricing be issued to all seller's of properties.

Price Offering

http://www.reia.com.au/userfiles/REIA_Guidelines_PriceOffering.pdf

TwotierMarketing

http://www.reia.com.au/userfiles/REIA_Guidelines_TwotierMarketing.pdf

Price Range for Properties

http://www.reia.com.au/userfiles/REIA_Guidelines_PriceRangesforProperties.pdf

# Peter Mericka said on December 8, 2009 4:56 PM:

Hi George,

Why don't you just tell the real estate agents to stop providing "appraisals".  Have them read "Modernising The Estate Agents Act 1980 - Submission to the Estate Agents Council" instead.

# George Rousos said on December 8, 2009 9:38 PM:

Thanks Peter, will do.

I'm finding when we present those other documents, real estate agents are learning fast to advise their clients on getting an independant valuation and stay right away from doing appraisals.

Besides ,the banks are asking their panel of valuers to pull back on price estimates and be more conservative.

The banks are using poverty thresholds and poverty guidelines as a means of determining whether a person qualifies for a loan, a banking procedure  adopted since the economic meltdown.

Peter, I saw some stats recently on housing affordability in Australia

Average income - $57,000 taxiable income.

Medium House Price - $420,000.

Just to service a $300,000 loan, an average couple would need to earn a combined income of $100,000 a year.

# George Rousos said on December 8, 2009 10:13 PM:

And the winner for the most defaults/ arrears on loans/mortgagee in possessions.... see link.

http://www.smh.com.au/national/pain-in-the-postcodes-as-interest-rates-rise-20091207-kffg.html

# Merimbula Real Estate said on January 4, 2010 7:39 PM:

George, some great points and nice information there.

The top 20 arrears list was an eye-opener!