# Why do Australians use real estate agents?



## Ald123 (30 March 2016)

I am really trying to understand what is the fascination with real estate agents in Australia?

I have lived in first world countries where nobody uses them, they are considered as non-productive parasites that work only for themselves raising the prices of properties when their monopoly association notes that vacancies are low and visits to home opens are high and lowering prices when sales are slow and no shows occur at home opens to ensure that they keep themselves employed. They play the owners like cat and mouse and pit buyers against each other. They put bad tenants into good properties so that owners get frustrated and then sell the properties. They have their mates the tradies giving them kickbacks for expensive repairs to be done. They treat tenants like rubbish. 

So I would honestly like to understand why Australians use them? 

I once called realestate.com.au and asked who I think was the owner at the time, if I could advertise my property privately. He was a really nice guy but said that he could not do that because if he did his business would go under as the real estate agents would dump him on the instructions of their Mafia like association. As a result a monopoly has been set up whereby private people have no access to a market.

The walled garden that they have created and the practices of real estate agents in this country is deplorable. I consider that people who use real estate agents to buy their home or to even have one in the room while discussing buying a home with an owner is plain stupidity. I wish real estate agents would just get a real job.

So why do Australians continue to use them?


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## Bill M (30 March 2016)

There are quite a few reasons why we use RE Agents.

I do not want to deal with tenants face to face, nor do I want to pay for the advertising to get tenants, the agent does that all in house. Then there are the phone calls, my TV signal doesn't work, my dryer doesn't work, the neighbour is too noisy, the guy upstairs drops stuff on my balcony all the time... stuff like that I do not want to deal with. Then if the tenant goes mental, smashes a few things and doesn't pay rent it is the agent that has to deal with it, including serving notices and going to the tribunal for you. Eventually they will end up evicting the tenant for you. 

Now for all this, totally hands off, they charged me 6.6% of my rent. Then they send me my end of financial year 2 page statement with all my income and expenses. I print it off and hand it to my Accountant at tax time. I think that is worth it, particularly as I do not always stay in Australia.

What you mentioned about realestate.com.au is true, they do not take private one off sales but there is a way around it. There is a company called "forsalebyowner" you can take out a package for around $699 and sell your house by yourself without any other fees. This works well and you can sell your house privately on realestate.com.au. I have a friend right now doing this, it's so simple.

It is not really that much of a "walled garden" as you say. I sold a house by myself just by advertising through the local rag once. The realestste.com.au option is the way to go these days. By the way my friend who is selling his house now advertised his house on gumtree for free too, he actually got a buyer off that site but he failed to go through with the deal.

The other reason I would sell through the Agent is that he may just get a better price. They know how to talk the talk and hype up buyers, I am not so good at that. They have hundreds of buyers on their books, in slow moving areas they clearly have the edge. They can also play off potential buyers against each other in order to get a higher price. Sure you will pay a commission for that but it might still work in your favour and you may get a higher price in the end.

The older I get, the less inclined I feel the need to do it myself, especially with regards to tenants, cheers.


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## nioka (30 March 2016)

Ald123 said:


> I am really trying to understand what is the fascination with real estate agents in Australia?
> 
> I have lived in first world countries where nobody uses them, they are considered as non-productive parasites that work only for themselves raising the prices of properties when their monopoly association notes that vacancies are low and visits to home opens are high and lowering prices when sales are slow and no shows occur at home opens to ensure that they keep themselves employed. They play the owners like cat and mouse and pit buyers against each other. They put bad tenants into good properties so that owners get frustrated and then sell the properties. They have their mates the tradies giving them kickbacks for expensive repairs to be done. They treat tenants like rubbish.
> 
> ...




The main reason is because BUYERS use them.  I am selling a property at the moment. I have it listed with agents and I am trying to sell it privately. The property is promoted on two private selling web sites and has a "sell without agents" sign displayed. So far inspections and enquiries have only come through agent introduced buyers.

You can advertise with realestate.com.au until sold for $249 through paul@salesand leasing.com.au. I have not used that service but had it offered to me recently.


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## chrislp (31 March 2016)

I would rather rent through an agent than a landlord directly.

A landlord who is too tight to use an agent is one to be avoided.


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## Ald123 (1 April 2016)

Property management and renting I understand, the laws in this country are so weak with regards to property standards and the general low standard of tenant here almost makes it mandatory. The dole mentality here means that the tenant treats the property and landlord like a service that they deserve and the government has not implemented quality standards like you have in Europe because the government here knows that if it were itself the landlord for all the rabble here it would go nuts so it offloaded it onto the so called investors. 

But the reality of rentals in Australia is that the vast majority, almost the exclusive majority, don't understand anything about renting properties and let's face it neither do most property managers. People don't realise that your rental property is a business that needs to be made tenant friendly and maintenance free. Most investors buy a property and rent it out and don't care about anything in the place. They love to take the money but don't care about the service they provide. A property manager earning even $200 dollars a month to look after your property will do nothing. For $200 dollars they can spend that just on the phone with plumbers and writing to you. Look at rentals in Australia they are nearly all slum quality in the old parts of Australia. Slum mentality owners and property managers and tenants.  

In business they say if you are not looking after your own business it will fail. Nobody will run. Your business for you. 
Property owners that have this hands off attitude are just showing their irresponsibility. They want their customers to pay them money but they don't care what kind of service they get. Well ladies and gentlemen if you pay peanuts you get monkeys. But here it's a case of monkeys only.  

Offcourse all this is real estate fascination is driven by artificially limiting land by not spending on German standard infrastructure and making speed efficiency and accessibility key. 

The end result of this big cow patty is the worlds highest property prices in the land with the greatest land area with least amount of people per area.

Even in the most far flung outback towns where 10 years ago nobody wanted to live and ten years later still nobody wants to live there, are real estate agents that are selling properties at the same price as you can by them in the bigger cities. There is no differentiation it's absolutely stupid. 

So is the conclusion that stupidity is rife and neither the average buyer nor seller is intelligent enough or socially developed to be able to sell or buy a property themselves.


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## Knobby22 (1 April 2016)

Ald123 said:


> So is the conclusion that stupidity is rife and neither the average buyer nor seller is intelligent enough or socially developed to be able to sell or buy a property themselves.




I wouldn't conclude that. I would conclude it is a cultural issue. Culture is quite sticky and difficult to change.

Australians love to bag real estate agents but most have no desire to do it themselves and the ones that do are looked on as strange and greedy by everyone else. You can't ignore the herd effect.


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## Ald123 (13 April 2016)

Knobby22 said:


> I wouldn't conclude that. I would conclude it is a cultural issue. Culture is quite sticky and difficult to change.
> 
> Australians love to bag real estate agents but most have no desire to do it themselves and the ones that do are looked on as strange and greedy by everyone else. You can't ignore the herd effect.




You make a good point. 

It's the part where you are looked at is strange. Why does anyone care what i do?


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## SmokeyGhost (29 April 2016)

Sadly this could be one example of why you DON'T want to use real estate agents.

http://www.domain.com.au/news/six-m...gency-offices-suddenly-close-20160429-goigc8/



> *Six Melbourne LJ Hooker estate agency offices suddenly close*
> 
> More than 100 LJ Hooker customers and landlords using the chain to manage their properties may have lost substantial amounts of money, after the sudden closure of six Melbourne offices.
> 
> ...




Been out of rental properties for quite a number of years.  Just not my thing.


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## johenmo (30 April 2016)

Try selling a house in Australia whilst you live overseas, as we did.  Whilst I'm sure it CAN be done, what a hassle that would be. Am thinking of selling and trying to decide if to do it ourselves.


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## aaronmoonpropertymanagers (22 November 2018)

Definitely agree with Knobby... It's a negative signal.


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## Macquack (24 November 2018)

Bill M said:


> They have hundreds of buyers on their books, in slow moving areas they clearly have the edge.



I was involved in the sale of a property where one of the owners insisted on engaging McGrath Real Estate as they supposedly had access to a massive data base of potential buyers. What a load of bullsh*t that turned out be. If they had such a large data base of buyers, then they would not have to advertise at all. Instead they con you into expensive advertisements in newspapers where they dishonestly receive a kick back. Driving their black porsche, BMW,  mercedes or audi they offer high expectations then if not achieved they pressure the vendor to drive the price down until they get a sale  and take their exorbitant fees. No fan of real estate agents here.


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## Skate (24 November 2018)

Macquack said:


> they offer high expectations then if not achieved they pressure the vendor to drive the price down until they get a sale and take their exorbitant fees




Hi @Macquack

It's called conditioning

Skate.


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## Bill M (24 November 2018)

Macquack said:


> No fan of real estate agents here.



Neither am I really but at my last sale 2 years ago I used the best agent in my area. The market was hot and he wanted a nice big fat commission. After a few other quotes I showed him the competitors commissions and I asked him, why should I pay you 2.5% when this agent is willing to do the same job for 2%? In the end he backed off and took the lower commission and got me top $$$ for my property. Could I have done it? Probably, but I think he got more than I could have so his commission was worth it, but who really knows.


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## Smurf1976 (19 August 2021)

It's much like anything isn't it?

Why would any ordinary worker with perhaps a few shares need an accountant to prepare their Tax Return?

Why would any able bodied person pay someone to mow a lawn for them?

Why would anyone pay big $ to have food delivered to their home that they could cook themselves at a fraction of the cost?

And so on. There are countless examples where people choose a particular option fully aware that there are cheaper ways of doing it.

Note that I'm not arguing wrong or right, just observing how it is.


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## againsthegrain (19 August 2021)

Smurf1976 said:


> It's much like anything isn't it?
> 
> Why would any ordinary worker with perhaps a few shares need an accountant to prepare their Tax Return?
> 
> ...



just a spam bot reviving a old thread, don't click on the url


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## qldfrog (19 August 2021)

Smurf1976 said:


> It's much like anything isn't it?
> 
> Why would any ordinary worker with perhaps a few shares need an accountant to prepare their Tax Return?
> 
> ...



Tou also pay for experience: your seller has sold before and should know if they can push price more etc
I still believe a good agent will get you more and could justify the commission
You canalso discuss the commission and ensure a win win.there are also issues like trust for deposit etc


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## Smurf1976 (19 August 2021)

qldfrog said:


> Tou also pay for experience



Agreed and same with the accountant and so on. You're paying for experience not just the actual doing.


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## Smurf1976 (19 August 2021)

againsthegrain said:


> just a spam bot reviving a old thread



Ah I see.....


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## clari_miss (20 August 2021)

In addition to all the economic and financial reasons, there is one basic one that will always be there. Laziness. People are too lazy to promote their own real estate, meet with buyers, learn how to sell correctly, and so on. Why bother when a person agrees to take on the entire load for a certain percentage?
I once had to sell an apartment on my own, and I will tell you that it is complicated. Photos, advertisements, ads. There are also legal issues. Thanks to the specialists from https://swpdxlaw.com/services/real-estate that at least they helped me with this. 
But otherwise, all the responsibility is on you, and it's not so easy.


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