2. CHOOSING YOUR AGENT
MANY SELLERS are of the opinion that all real estate agents
are the same, until they hire a really good agent who delivers
six-star service, a great sales experience and the result they
were after. Let’s be clear: not all real estate agents are the same.
A good real estate agent knows that sellers have a choice. In
fact, being a real estate agent is one of the most competitive
professions around, so the smart ones will differentiate
themselves from the rest and show why they should be your
first choice.
Making the right choice of agent will be a considered
decision not arrived at by accident. Just as achieving the
highest price for your property will be the result of following a
proven process, not taking a hit and miss approach.
Focus on following a process, not
the promise of a high price.
Types of ‘agents’
So where do you start? It’s really important to ask the right
questions to ensure you are working with the right type of real
estate agent. This may seem basic but the word ‘agent’ has
several applications:
- Licensed real estate agents have studied courses and
completed their real estate license, allowing them to own
and operate a real estate office and sell real estate. They
may also have earned additional accreditation that allows
them to specialise and deliver a better overall service.
They work for the property seller (vendor).
- Certified agents must have attained minimum
certification in their area, allowing them to work as an
agent while being employed by an appropriately licensed
broker or principal. This means they work under the
supervision of a licensed real estate agent. Again they
work for the seller.
- Buyers’ agents are something completely different. They
will help you source your next property. They represent the
purchaser (not the vendor). They must hold appropriate
credentials to represent the interests of buyers in a real
estate sale. Universally, selling agents represent home
sellers and buyers’ agents represent home buyers. It
would be a conflict of interest to represent both sides of a
- Residential letting agents are different again; they will
manage your property if you intend to rent it out to
tenants. Letting agents either work as a stand-alone
leasing business or as a division of a real estate sales
In Australia, the selling agent will list and sell your home and
will charge you a fee to do so. In the United States, the selling
agent may list your home but may not necessarily sell it, relying
on buyers’ agents to find the best buyer. In this instance, the
seller will be charged a combined fee which will be split
between the listing agent and the buying agent.
Most licensed real estate agents work as independent agents,
as the principal/broker of their own company, or as a member
of a brokerage or franchise office (we look at the difference
between a franchise and independent agency below). They
choose to either work part-time or full-time. The flexibility of
work hours allows many family-orientated real estate agents
the chance to work part-time. As a seller, one of the decisions
you will need to make is if you wish to hire a part-time or a fulltime
real estate agent to sell your home.
In Australia, there are no specialist designations; we are all
just real estate agents. In the US, there are many different
professional designations which show that agents have taken
additional courses in specialised fields and they are permitted
to put accreditation letters after their name. These include the
courses supported by the National Association of Realtors
(NAR), such as:
• CIPS – Certified International Property Specialist
• CRB – Certified Real Estate Brokerage Manager
• CRS – Certified Residential Specialist
• GRI – Graduate Realtor Institute.
If you’ve lived in the US and wonder why there are no letters
after the real estate agents’ names in Australia, this is the
reason why.
Franchise or independent office?
Real estate offices are either members of a franchise group or
they operate as independently owned offices with no franchise
affilia tion. Principals or brokers who own and operate a real
estate office are business people and they have costs and
overheads to cover so part of every sales transaction by
individual agents in any office goes towards the running costs
of the business. It should be remembered that selling agents do
not keep all the fee that they earn when selling a property and
the proportion they keep will vary with their experience and
volume, whether they are working for an independent or a
franchise office (more about fees and charges in chapter 6).
According to the most recent Australian Bureau Statistics
survey into Australian real estate services at the time of
writing, 53% of real estate industry workers were employed by
fran chised agencies and 47% by non-franchised agencies. So
it’s almost half and half.
So when choosing the right agent you will likely consider
agents from both groups and will find that many independents
started their careers as agents in franchise groups where they
received excellent training, systems and practices that gave
them the confidence and experience to start out on their own.
There are good and bad agents in all offices so the choice is not
so much franchise or independent but rather the agent who
you feel is offering you what you are looking for.
Should you choose a brand or an agent?
The attraction for many real estate agents to work with a
franchised real estate office is that it will be a recognised brand.
Many brands are well known because they have the financial
capacity to advertise and promote their brand so that you feel
familiar and comfortable calling an office of a brand that you
see on a day-to-day basis. A great brand can make you feel joyful,
inspired, hopeful, nostalgic (or at least that’s what branding
experts would have us believe). A great brand is often regarded
as the local authority, an innovator, being in touch and involved
in community activities, the home of creative communicators.
Real estate agents are salespeople with a purpose and to
achieve their individual goals they may choose to change from
one brand to another from time to time. The good ones continue
to be successful and the not so good ones continue to think the
grass will be greener at another brand, so your choice should
be the agent who impresses you most and the agent’s choice
will be the brand that represents them best.
Number-one office agent
Every real estate office has several real estate agents and they
all want to be the number one agent in their office. There are
internal competitions each quarter to determine the number
one agent working not just in one office but working under that
Each office in the brand has a public face and is known in
its own marketplace through its corporate advertising and
promotions. Within each brand there will be high-achievers
who embrace the culture of that brand and who are known for
their market share and sales success.
However, equally, there will be many agents, even in the very
same office as the high-achievers, who are struggling to get
listings and make sales and who are only just earning enough
commission to pay the bills. So it is important to recognise that
any agent, regardless of their brand, who is desperate for your
business, may be willing to discount fees for you but this could
be at the expense of them cutting corners and they are unlikely
to be the best person to sell your property for you for the
highest price.
Irrespective of brand it’s the individual you’ll
be working with
Despite the hype and publicity surrounding a brand, there will
always be a huge gap between the survivors and the champions
working at any real estate agency. Every individual agent has
their own skills set, experience, motivation, training, compe -
tency, negotiation ability, support network and attitude to set
them apart from every other agent.
Above all, make sure the agent you choose puts your best
interests before anything else,
whether they are part of a branded office or an independent.
Selecting an agency brand that you’ve heard is a market
leader will not necessarily mean you will end up with a high performing
agent. While the brand structure may manage the
agent’s accountability, it will be the agent’s individual skills,
competence and attitude which will determine their success in
selling your home for more.
Choosing a well-known brand does not guarantee you will get a good agent.
That being said, the strength of your agent may be limited
unless they have a strong office behind them.
Understanding how an agency works
When trying to choose an agent, some sellers will simply
telephone a big name brand office and the office manager will
assign an agent to their enquiry. This is often done on a ‘farm’
area basis. But what does that mean?
Well, real estate offices are generally suburb or postcode based
and each office has an area of homes that makes up its
core business area. Each suburb or district is serviced by one
franchise group office of any one brand and it’s likely that
another office of the same franchise group will service the
adjoining area/suburb. These offices pay the master franchise
or head office group to set up business in that suburb so they
actively ‘farm’ the suburb they are paying to work in to try and
get as much business as possible. That core business area is
made up of streets with a mixture of apartments and houses.
Some streets may have prestigious waterfront homes while
other streets will have small houses on a main road. The value
of the homes on each street varies enormously, however, they
are all part of that agency’s farm area.
Within the agency office, the salespeople are each assigned
a geographical area of houses and streets to look after or farm.
The highest-earning agents will typically be given the highest earning
streets to look after. Offices often feed the best agents
while the rest have to take care of themselves. Within their own
office, individual agents, who are all effectively running their
own small businesses, are competing with each other for houses
to sell in their assigned suburbs but are only allowed to actively
market themselves in a specific group of streets.
The individual agents are allocated streets and are instructed
to contact the owners of the homes in their farm, which could be
somewhere between 500 and 1,000 properties, and make
themselves known to those home-owners so that if they’re
thinking of selling the owners might consider that agent to
represent the sale.
Assigned agents attempt to take ownership of the homes in
their farm through any means possible, including door knock -
ing, letter-box drops, cold calling, sponsorship and local area
advertising. They work to be known to home-owners so that if
they are thinking of selling, the home-owner may be more
likely to invite their farm area agent to meet with them. If the
agents don’t demonstrate ownership of their office-assigned
areas, then those farm areas will be re-allocated to another
agent in their office.
The level of competition inside one franchise group office
between individual commission agents is fierce. In each suburb,
you could easily have four to eight franchise brand name
groups and another six or more independent offices all doing
the same thing – allocating streets for individual agents to farm.
It’s no wonder then that your letter box is chock o’ block full of
real estate promotional mail. The agents are forced to ‘get to
know you’, and the simplest way to meet their office managers’
requirements is to deliver a printed mail flyer in your letter box
on a weekly basis. If you’re like me, you simply transfer the
unsolicited mail straight to the rubbish bin without giving it a
second thought.
If, on the other hand, you actually know the name of a real
estate agent, then you are more likely to call them up to meet with you.
If you have a relationship with a particular agent then that relationship
generally trumps whether they work for a
franchise office or as an independent. It is more important that
you choose the right agent for you and your individual
circumstances than associate with a certain office or brand.
Nothing stays the same
You should be aware that real estate agents change brands and
offices about as often as anyone else might change their jobs.
The main reason is that sales managers at other real estate
offices are constantly monitoring rival agents who are currently
selling well and they then actively try and poach the most
successful ones to join their team. There is always the promise
of the ‘grass is greener’ on our side of the fence and if an agent
is feeling less than appreciated where they are, then they will
be open to the possibility of making a change.
Agents leave one real estate office and move to a competitor’s
office every other week. The culture of one office may
appear better than another, or another brand might be flavour
of the month; whatever the reason, it doesn’t always go well
and that agent might be changing offices again sooner rather
than later. Agents may also leave a branded or franchise office
to open their own independent brand office to make good on
their life-long dream of owning their own business. Many top
real estate agents find out the hard way that they are great
salespeople but not great at running a business, which requires
a different skillset.
Importantly, selling a property is a business decision and
we all choose to do business with people we like and trust, so
regardless of the brand or the promise, choose the agent who
you feel will stay true to you and your goals.
Local area specialist or out of area agent?
If you don’t know any local area agents, should you hire
someone you do know, even though they are an out of area
agent?
It’s a good question and one that only you can answer. On
the upside, if you feel confident about a real estate agent
because you have had a great experience with them before, but
they don’t normally sell in your area, by all means call and
discuss your options with them. If you are both comfortable
that the agent can represent your sale without compromising
the time and effort involved, then go ahead, hire an out of area
It could be argued that an out of area agent is not an area
specialist so they may not know all the ins and outs that make
your area unique and therefore can’t represent your sale with
the level of intimate local knowledge required. It could also be
argued that a local area specialist may have more local buyers
on their database and can call past-potential buyers in the area
rather than simply relying on new buyers from paid marketing
and advertising.
However, you could also argue that local area specialists
know the area so well that they might be guilty of boxing a property
in a certain price range without believing a higher price may be possible.
Out of area agents may be more willing to try a different approach
to pitch for a higher price that local agents and neighbours of the
property may not believe is
An out of area agent may try harder
to beat local price beliefs and can sometimes
achieve a higher out of line sales result.
On the downside, travel time to the property may restrict open
inspections, depending on how far the agent has to drive. Less
knowledge of active local buyers means more marketing to
attract the same buyers and if the agent does price the home
incorrectly then you could be in for a long campaign at the
wrong price.
Keeping it in the family
Some sellers have a relative in the real estate business and
believe they should be keeping the sale in the family. This is an
emotional decision, not a business decision, however, the real
estate industry has an accepted method of sharing the love.
Our industry offers a simple solution in the form of a paid
referral fee. If your relative is out of area and unable to manage
the sale for any reason, then they could actively help you
choose the right local area agent and refer you to that agent as
their client. As a referral client, the listing agent can choose to
pay a referral fee to your family real estate agent. The fee varies
but is often set at 20% of the selling agent’s fee. This allows your
relative to assist you in selecting the right agent to sell for you
and still receive a fee for their involvement. This keeps part of
the sale in the family, making it a win/win for everyone. This
referral fee is not just for families; if you have a great
relationship with an agent and they can help you find the right
agent to sell for you then they deserve a referral fee too.
Local area specialists are best
No-one will know your local area like your local area specialist
real estate agent. Ideally, your agent should be selling property
in your area all the time and will, therefore, have a list of buyers
who are ready to purchase in your immediate area. A local area
specialist should be able to drop everything and literally be at
your property within a 15-minute drive.
Every real estate agent works in a local area. Usually, they
work in a radius around their office location so that when you
come to sell, you should be able to find a local area expert at
any of your local real estate offices.
As discussed, individual real estate agents are allocated a
‘farm area’ by their office manager to ensure that their office
will be in touch with everyone living in the area at some stage
during the course of every year. Agents who concentrate on
marketing their services in a single ‘farm’ are more likely to do
more business with people they get to know in their own
allocated area. Agents who live and breathe an area of streets,
comprising often up to a thousand homes – and get to know
those homes better than any other agent – earn the right to call
themselves an area specialist.
An agent who knows the owners of a thousand homes better
than any other agent is going to know when one of those homeowners
may be thinking about selling ahead of others who are
not in touch with the owners on a regular basis.
If a buyer has told that agent he specifically wants to buy in
a group of streets, then there is a good chance that agent may
be able to connect a motivated buyer with a potential seller in
a quick and simple transaction that doesn’t even come onto the
public market. This type of ‘quiet’ sale only happens when a
local area expert really is in touch with their buyers and sellers
on a regular basis.
Single agent or an agent with a team?
Different offices support different business models for the
agents working there and one of those models is to encourage
team-based selling. The single agent working alone is limited
in their ability to manage a small number of properties at once,
while the team model allows for carrying more property
listings and higher volume selling.
A selling agent may start out as a single agent in an office
and when they gain sales momentum they then hire people to
help them. This allows them to offer a better service and achieve
more sales. As their team roles evolve, they either continue a
team structure successfully or the team members leave to become
agents themselves, so the selling agent may go back to
being a single agent again or having one personal assistant (PA)
as their support.
As the seller, you’ll be choosing a real estate agent to sell for
you that you believe will deliver the very best service and result.
Often, you don’t even know or care if the agent you choose is a
single agent, is an agent with a PA or is an agent with a team,
as long as they can demonstrate how they will deliver peace of
The business of being a real estate agent is one of continuous
personal development and keeping up with changes in the law
and legislation. Real estate agents have required learning with
annual Continuous Professional Development (CPD) and many
agents work with a business coach or trainer much like
professional athletes. Many of the trainers support the concept
of an Enterprise Business Unit (EBU) so they work with a single
agent to encourage them to build a team which starts with one
assistant to share the work load and may build to three or more
team members over time. Many brands prefer the team model
within their organisations because teams will generate more
sales and the lead agent building the team will carry the costs
of the additional team members rather than the owner of the
Individual agents who expand to create a business unit with
additional staff carry the cost themselves, increasing their
overheads with permanent assistants who earn a wage and a
bonus based on turnover of properties sold. While a single agent
(with some agency support) can only list and sell a limited number
of properties at any one time, team-based agents who
adopt the volume model by adding a team can manage many
more properties with the opportunity to multiply their income
If a team-based agent is working to sell four properties a
week, instead of four properties a month as an individual
agent, their time is limited on how long they spend on any one
individual property, especially as they have the increased
burden of managing staff and running their business as well.
Franchise groups are renowned for holding internal weekly
meetings and other distractions that make the team agent’s job
of providing an excellent sales experience to every seller that
much harder.
Many successful agents work in teams of two, three, four or
even five agents, all as part of the lead agent’s business goals.
This allows the lead agent to concentrate on listing homes in
his farm area and negotiating with the best buyers his team has
identified. One of the support team will concentrate on buyers,
one on compliance and paperwork, one on prospecting and
another on marketing, database and open home duties.
The real estate agent you choose will be your business
partner in your largest ever personal business transaction, so
you want to be sure your agent is always ready, willing and able
to be contacted when it suits you. Communication is the key to
a successful partnership, so you will want to know that your
agent returns calls promptly and is never too busy for you.
So, when choosing an agent, it’s important to know whether
your agent works with a partner, associate, PA or team and
whether they plan to take holidays during the time you are
listing your home with them. And you may not know unless
you ask.
Many agents with the overheads of additional staff find it
hard to put the right assistants in the right job and their teams
of people suffer churn-and-burn on a regular basis. It’s possible
that your sale will be represented by people you have never
There is no right or wrong model. It’s your decision whether
you hire a single agent or an agent with a team. And, just for
the record, if you were to ask me: “Should you hire a male or a
female agent?” I would reply: “Yes, you should.”
