Consumers are at risk of not achieving the best price for their property if they use the services of companies that charge an upfront fee, according to the Real Estate Institute of New South Wales.
REINSW President Leanne Pilkington said with the cooling market consumers are at risk of paying even when their property does not sell.
“There had been a lot of press surrounding companies that offer a flat fee upfront to sell a consumer’s home rather than the traditional commission model,” she said.
“There is no motivation or incentive for these agents to take a professional approach in achieving the best possible result as they have already been paid regardless of the outcome,” she said.
Ms Pilkington said in buoyant markets upfront fees are attractive to consumers seeking to save money but they are not significantly tested because of the high demand and low supply.
“As the peak body REINSW is therefore concerned for sellers in this changing market who are vulnerable to such low cost high risk strategies that have the potential to leave them in the lurch.
“We encourage consumers to explore a full range of options when it comes to selling their most valuable asset: don’t just go for the lowest cost option as the risks are too high if you get it wrong. Never take anything on face value, do your research and ensure that you are making the best decision.
“As the market cools the true value of an experienced real estate professional can really be seen,” Ms Pilkington said.