Flat Fee - Benefits
Some are likely to believe that traditional commission based agencies act as an incentive to sell your property at the best possible price.
However, many don’t consider that Flat Fee agencies often value properties at the same price as commission based agencies, yet only charge a fixed price.
Here are more reasons to consider a flat fee instead.
Deceased Estate Properties
A deceased estate property is a term used when the former owner of the property
has passed, and the property is open for auction. In many cases, you will find that
family members live in different states or even countries to the family member that
has passed. This makes it difficult to deal with admin, paperwork or renovations
regarding the sale of their family members former home. This is where we step in to
ease out the process and act as an intermediate.
In this case, it is more beneficial for the family to use an agency with a fixed rate,
rather than one based on a commission fee. By using an agency with a commission
fee, you will end up paying 3-5% of the final selling price, whereas a flat fee agency
could value the home at the same price, but at a fixed lower rate. Ultimately, saving
you money.
Over-capitalized Properties
Over-capitalization is when you have invested more funds into the property than
you'll gain back in future earnings with resale. Of course we all have desires, especially when it comes to creating our dream home and renovations are a great way to increase your property's worth, however, the more you do the more your return on investment generally decreases. The reason for this is that most people would rather
consider buying a house in the location that are of similar value to the others.
Another example of over-capitalized properties is when the buyer purchased the
home while the market was at its peak, and as the market dropped, the property's
value decreased.
This is where you want to start questioning if it will be reasonable to use an agency
that is based on a commission fee or save money by using an agency with a flat
fee instead.
Divorcees or Seperated
Going through a divorce or separation is stressful enough, having to deal with the
selling of a jointly owned property, only adds to it. Financial expenses can skyrocket during this time & you want to make sure that you are able to save where you can.
If all goes well and property settlement has been confirmed, it would be best to
partner up with an agency that offers a flat fee, as you'll be paying less than you would using an agency with a commission based incentive, this way, you can sell the home for its property value & earn more in accordance to the confirmed property settlement.
Family Property
As life can be unpredictable, we want to be informed and prepared in every situation
or circumstance. There are many cases in which we want to consider a more
affordable route to undertake when deciding to sell our investment property.
Here are some examples:
- Losing a partner, directly affecting your financial situation.
- Being unable to afford the mortgage due to loss of income or a cut-back on shifts.
- Expenses are more than what you are earning on the property.
- You've recently retired or started working part-time.
Downsizing
Downsizing is when you buy a smaller home to the one you currently have. This
decision is often made by those who's children have left the home, are having
difficulties dealing with the upkeep of their home or are finding the related costs hard
to deal with.
It could also be that you are eager for a change, wanting to move closer to family
members or looking for a change. Nevertheless, in this scenario, you'll be looking for a property that suits your current or future lifestyle.
Downsizing to a smaller home can be a real opportunity for those looking to save
money. Using a flat fee agency will only increase your total savings.
Investment Property
Investing is a long-term commitment, however, sometimes long-term commitments don't pay off as we had hoped or expected. Investing in a property can be a hit or miss, and just as any long-term investment, when it no longer serves, it is important to be aware of the signs on when to let go.
There are many indications we need to be aware of when deciding to place our
property in the market, such as, the need for extra capital, not being able to afford
body corporate expenses, skyrocketing interest rates, trouble finding suitable
tenants, and many more.
Not only do we need to be aware of the above mentioned signs, we also need to be
aware of choosing an agency that will give us a good return on investment when
having gone through the process of deciding to sell our investment property. One that values selling your home for the best possible market related price, while
charging you an affordable low flat fee with no hidden costs.
“Wise spending is part of wise investing, and it’s never too late to start”
– Rhonda Katz
