Evaluate what the sales records actually mean
When you’re researching prospective real estate agents, it’s important to pay close attention to their sales record. Most agents are open about their recent sales, being that it’s how their success as a sales agent is measured. However, your job isn’t to uncover an agent’s recent sales record, but to evaluate that record.
When looking at an agent’s recent sales, it’s important to look, not just at the final sales price and the agent’s comments — such as, “set a new street record” or “sold well above the reserve” — but to look beyond the positive spin to uncover what the price and those comments really reveal about that agent.
Cut through the positive spin
We recently wrote about why properties exceeding their reserve price by huge amounts is not actually a result worth celebrating. Why? Because it actually shows that the agent wasn’t in touch with the market or buyers at all, and on auction day selected a reserve price far below the market value of the home.
When we see agents boasting about numerous properties selling for prices that far exceed the reserve — and we’re talking about an amount of more than 10-15 percent of the reserve price — immediately alarm bells start ringing. If it happens consistently with each property an agent takes to auction, then it’s indicative of a wider problem of the agent undervaluing or not responding to the market.
How many sales in the street to get a street record?
In the case of street records, it’s a good idea to check when the last street record was set and for how much. If the last time a street record was set was in 1996, the last time property was sold there, then that claim for setting a street record is fairly worthless.
If, however, a street record was set just a few months prior and it was (ideally) by another agent selling a similar home, then that’s comparable data. That said, a street record for a 5-bedroom, 3-storey house, when all the other properties in the street are 3 bedroom, single storey original homes, is, again, fairly worthless.
Before you appoint, dig deep
Like we said, most agents are more than willing to share their recent sales history with you. It’s up to you, then, to really take a close look at those sales records to determine the best fit for you.
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