By: DR GAD AKWENSIVIE
A common challenge many Ghanaians face is choosing a good estate agent. In fact, two out of three recent home movers we spoke to said they were not satisfied with the services they received from their agents. This implies that selecting a good estate agent to buy, sell, rent or let property quickly and for the best price remains a challenge for many. So how can you know that your estate agent is a good one? This piece provides leads on selecting a good estate agent in Ghana.
Identifying a good agent is important because it can make the difference between getting a good price and not selling, renting or buying a property. Yet, many Ghanaians we interacted with believe they can sell, buy or rent their own property and do not need an estate agent. Nowadays, it is possible to sell, buy or rent property by yourself because there are many websites that provide avenues for individuals to advertise their properties. There is no doubt that advertising your property and selling it yourself at the right price will save you the cost of engaging an agent.
But the fact of the matter is that experienced agents can help you obtain the best possible price on the market for your property. It is, therefore, a wise decision to identify and engage qualified estate agents to buy, sell or rent a property for you. Engaging an estate agent is a cost-effective approach. For example, it is worth paying GH¢20,000 to the agent who sells your property for GH¢500,000 than selling it yourself for GH¢450,000. By engaging an estate agent, you save yourself time, effort and the stress of negotiation which comes with doing it all by yourself. It is a smart idea to engage an estate agent. It is important to face the fact that you cannot do everything yourself. It makes a lot of sense to outsource the things that others can do, and do better. This will enable you focus on other tasks. So engage an estate agent to promote your property. Remember, the agent works for you and you are not under any obligation to accept offers he/ she brings and you do not have to pay him/her until he/she finds a buyer, seller or tenant for your property.
The most common approach to identifying an agent is to ask friends and family members for personal recommendations. It is always good to have personal recommendations. Questions you should be asking about the agent are about his/her track record in renting, letting, selling and buying properties. You should also be comparing estate agents based on facts. For example, how quickly have they sold properties; how successful they have been; and how close they have come to achieving the asking price? Signboards with inscriptions “For Sale”, “Sold”, “Now letting” and “Now selling” placed outside properties are not very common in Ghana except in a few built-up areas. Where they are used, they are good indicators of which agent or agents are doing well.
Full list of approved valuation
Another way of identifying estate agents is to contact the Ghana Institution of Surveyors at www.ghisonline.org/contact-us/ for the full list of approved valuation and estate agencies in Ghana from which to choose. Remember, the Ghana Institution of Surveyors is the only recognised professional body in Ghana which regulates the practice of valuation and estate surveying, including estate agency. You should narrow your choices down to a shortlist of about three and invite them to do a valuation. After they have done the valuation, ask them to explain their reasoning. A good estate agent will be able to justify his or her valuation. We found that most approved agents of the Ghana Institution of Surveyors justify their valuations with empirical evidence. Others could not.
Agents know that people select them because of the valuation they give. Some will deliberately give optimistic valuations to make you believe you can get a higher price from them, and later try and talk you down after you have contracted them. Others will swear they are giving a truthful value, and tell you not to be deceived by misleadingly high valuations.
It is important to decide the number of agents you want to use. The two options are sole-agency or multi-agency. A sole agency agreement is when you instruct one agent to sell your property over an agreed period, usually 12 weeks. During that time, you should not change or instruct other agents otherwise you may end up paying more than one commission. Also avoid getting tied into a long agreement with a sole agent. Six to ten weeks is recommended. If after the term you are satisfied with the agent’s service, you can extend or renew the contract.
In a multi-agency setting, however, there are no restrictions as to how many agents you can instruct and there is no fixed term. You will be obliged to pay commission to the agent who introduces the buyer or seller. It is also advisable to keep to a maximum of three agents if you opt for multi-agency. In that case, select agents from different parts of the city for better and wider coverage for your property.
Before engaging them, find out what their standard terms and conditions are. To be more specific, ask them what their standard commission rate is. Ask them what their typical tiein period is before you can break the contract, in case you are not happy with their service. Does the agent have any estate agency, marketing or sales qualifications? We have found that most good estate agents have some formal training in marketing. You must, therefore, be interesting in knowing that about your estate agent. The next thing is to investigate if the agent is a member of an accredited body or recognised professional trade association such as the Ghana Institution of Surveyors, Ghana Real Estate Developers Association and others.
Members of the Ghana Institution of Surveyors, for example, provide services with values based on the code of ethics and principles. They are, therefore, obliged to take very good care of their clients because they can be penalised if the client lodges a complaint.
Find out about his viewing policy. Ask if the agent will accompany potential buyers or who will be conducting viewings when you are not available. Ask what marketing materials they will be using (photographs, radio, newspaper or online services). Good agents invest in marketing to ensure that they get the best price. They normally belong to a network and have links and access to online marketing sites which raises the chances of securing a property or client for your property.
One thing you should look out for is whether or not your agent can talk confidently and with knowledge about your kind of property. During the initial interaction phase, the agent must be able to confidently talk about your kind of property and support his/her arguments with facts. For example, if you are engaging an agent to sell your property located in Adabraka, Bantama or Market Circle, ask him/her what strategies he/she will adopt if your property does not sell within three months or as quickly as you expect. Think about his/ her response and ask yourself if he/she sounds convincing?
In Ghana, most agents only work from Monday to Friday whereas majority of property sellers, buyers and renters search over weekends. So ask the agent if he/she works on Saturday and Sunday. Agents who work over weekends will ensure that your property is accessible to more potential clients.
Estate agents in Ghana normally charge you 1.0 per cent and 5.0 per cent for a sole agency agreement of the final sale price. You should avoid estate agents who demand upfront payments such as a “down payment” or what has been termed a “moving fee” even before accepting to work. You should also shun agents who demand commission of more than 5.0 per cent of the sale price. An approved estate agent of the Ghana Institution of Surveyor, for instance, will not demand a “moving fee.”
Traps to watch out for
If you have to sign any contract with an estate agent, there are traps to watch out for. In Ghana, although estate agents are open to negotiation on their terms and conditions, each estate agent has different terms and conditions, and their fees cover different things. Ask him/ her whether or not his/her fee includes marketing, staging and other costs such as preparing the property details and so on. It is always better to have these costs included in a single fee.
Most agents insist that you enter into sole selling rights with them. As much as possible, shun agents who insist on “sole selling rights”. What sole selling rights mean is that even if you find a buyer yourself, you will still have to pay him a fee based on the sale price. If you have to engage an agent on sole selling rights basis, make sure it is for a very limited period three to four weeks. The advantage of a short sole selling rights contract is that you force and push the agent to work very hard to get a buyer within the period of the contract.
What we also found particularly in Accra and Kumasi is that estate agents hate agreements with time limit so be firm in making a decision on placing a time limit. Make sure the agreement you sign with them has a time limit so that you can change the agents if you are not happy with their services.
It is worthwhile to select a good estate agent for your property because identifying a good agent can make the difference between getting a good price and not selling, renting or buying a property. With these tips as your guide, you should be able to select a good estate agent. At the end, you will find out that it was worth outsourcing the process of identifying a buyer, seller or tenant for your property. I wish you good luck!
The author is a Landed Property Investment Advisor (Land Administration, Valuation and Estate Agency, Appraisals and Viability Studies). Email: email@example.com. Website: www. gadakwensivie.com. Telephone 0244 843 997