What are the benefits of a Vendor’s Advocate and why should you use one?
Firstly, we need to look at the definition of a Vendor Advocate. If you are selling your property that makes you the vendor. A Vendor’s Advocate represents you when it comes to selling your property. But how does a Vendor Advocate differ from a real estate agent? Good question!
Essentially, Vendor Advocates act like an independent advisor solely to you. Unlike the real estate agent who deals both with you and the purchaser, the Vendor Advocate works exclusively for you as the vendor and deals only with the real estate agent on your behalf. They support you throughout the sale process and ensure that you get the best result when selling your property.
Let’s look at the top 8 reasons you should use a Vendor Advocate:
1). Agent selection
When going to your local real estate agent and ask them to help sell your house, they would most likely see you as a ‘once-off’ customer. Most of us are not in the business of regularly selling houses, so the agents main objective is to get your listing, secure a sale, and move on to the next listing.
A Vendor’s Advocate, however; is in the business of managing numerous properties for clients in the area. They will know who the most active agents are in your area, what their particular skills are, and their reputation generally.
Agents see Vendor Advocates as a source of repeat business, and this gives the Vendor Advocate leverage to negotiate the agent’s terms and commission down on your behalf.
In other words, a Vendor Advocate works solely for you. They ensure that the real estate agent appointed for the sale of your property is the best available, fairly priced, and kept accountable throughout the sale process.
2). Independent valuation
Real estate agents will give you a market appraisal of what your property is worth. They usually err on the high side, to encourage you to select them. After all, it is always tempting for the vendor to select the agent who thinks your property is worth more than anyone else.
Don’t fall into the trap of selecting the agent with the highest price estimation, as often they are just trying to ‘buy’ your business. Agent selection should be made on a number of grounds, not just their estimated price. At the end of the day, the market will determine what your property is worth, not the agent who quotes the highest price.
A Vendor Advocate will help you assess the marketing proposals from a number of agents, including reviewing the recent comparable sales in the area. This helps you assess what your property is realistically worth.
Some Vendors Advocates will arrange for your property to be valued by a licenced valuer. Although there is a cost, it may be worthwhile getting a valuation to help you determine what your property is really worth. It also helps to avoid stress and disappointment at the time of the auction.
3). The best method of sale
Which is the best method of selling your property in the current market – auction, expressions of interest, or private sale? Should it be publically advertised or marketed privately to the agent’s existing database?
These are a number of choices to make when selling.
Just because your neighbour sold their house at auction for a great price, doesn’t necessarily mean that you should also sell by auction.
Some vendors don’t like their home being inspected by hordes of people, most of whom have no intention of buying. They may prefer an off-market sale where the agent invites people he knows to be interested in buying a particular property.
Having said that, a public auction is generally considered the best way to achieve the highest price for a property. It brings everyone together at one time and hopefully creates competition among buyers. Sometimes auctions surprise everyone.
The best method of sale is determined by a number of factors – the nature of the property being sold and the local market. For example, with country properties, there are fewer buyers at any one time so an auction may not be the best way to achieve the best price.
Sale by ‘expressions of interest’ may get the best result, as the bidders don’t know what the others are offering.
Remember that some agents are better at selling by private treaty or off-market than others, who may be better at selling at auction. A Vendor’s Advocate can advise you on the agents and will help you through the sale process, no matter which sale method you choose.
4). Marketing Strategy
The marketing strategy for a property doesn’t just refer to the ‘for-sale’ sign, newspaper advertisement and listings on the internet. Marketing is more complex than that, and it is important to get the marketing mix right without overspending.
Social media, drone shots, professional staging and video walkthroughs have all become commonplace in today’s property market.
Your marketing strategy should also relate to any improvements that might be needed to your property to best present it for sale and to maximise its price. Vendor Advocates will be able to give you advice on what to do and how much to spend to get the best return on your investment. Very often it is clever minor cosmetic improvements (painting, carpets, landscaping etc.) that give the greatest return, as opposed to more major renovations where money can be wasted.
Also, ask the Vendor Advocate if they provide finance for improvements to properties. If you are ‘asset rich and cash poor’, this can be a quick and cost-effective way to undertake those improvements and make a big difference to the sale price.
So, when it comes to selling your property, Vendor Advocates are best placed to ensure that the agent is giving you value for your marketing dollar. They can also provide you with strategies to improve your property, maximise its sale price and generate a return on any money spent on improvements.
5). Best time to sell
Something that can impact a marketing strategy is the time of year in which to sell your property.
Generally speaking; Spring is the best time of year to sell the property as there are more buyers in the market. However, what happens if you need to sell your property more urgently and are not able to hold off until spring? What will other time of year generate the best result?
If your property is in a holiday location, then perhaps December/January is the best time to sell, as your property can be exposed to numerous holidaymakers possibly looking for a holiday house.
There is no ‘one size fits all’ when it comes to the best time to sell. Your real estate agent would most like advise that ‘now’ is always the best time, but is ‘now’ the best time for you, or for them? A Vendor Advocates can offer you impartial, independent advice in this area with your needs in mind.
6). Screening of offers
Vendor Advocates can also assist you by screening any offers that are received by your appointed real estate agent.
This can save you time and confusion by ensuring that you are only being presented with offers that are reasonable for you to consider. By reasonable, we mean within the context of an independent valuation of the property, the agent’s initial assessment of value and feedback from buyers throughout the marketing campaign.
The pressure to accept an offer is also removed, as Vendor Advocates are independent of the purchaser and acting solely in your best interest.
7). Cost Neutral
Although many Vendor Advocates share a commission with the estate agent, some Vendor Advocates will be truly independent of the agent, i.e., they will charge a fee for service rather than share in the agent’s commission. If asked to share commission, agent generally will do is increase their commission to offset the amount that goes to the Vendor Advocate.
Vendor Advocates make an agents job easier by representing the vendor. They are also a potential source of ongoing business for the agent. Accordingly, by charging a fee for service and being independent of the agent, the Vendor Advocate can negotiate the agent’s commission down to a point where it is fair yet reasonable. Often this will offset the cost of the Vendor Advocates service in full, or in part.
On top of this, the Vendor Advocate takes the time and stress of selling a property from the vendor. On average, a vendor will spend around 70 hours of their time managing the sale process. With a Vendors Advocate, that work is outsourced.
Finally, the expertise and independence that a Vendor Advocate brings to the sale of your property ensure that you will get the maximum price possible.
All of this is likely to make the service of a Vendor Advocate, particularly those that charge a fee for service, cost neutral, or perhaps even better.
8). Sales contracts
It is important for any marketing campaign that the agent has the Contract of Sale and supporting documents at the commencement of the campaign.
Potential buyers will be deterred from buying by not being able to review the contract (or have their lawyer review the contract) in time for the auction or to make an offer prior to the auction.
A Vendor Advocate can assist vendors by ensuring that their lawyer or conveyancer has been instructed with plenty of time to obtain all the necessary documents and to prepare the Contract for Sale.
So, in summary, Vendor Advocates are there to represent you as the vendor and to get you the best result when selling your property. Their expertise and independence can literally mean that their service pays for itself, while also saving vendors the time and stress associated with the complex area of selling the property.