Exclusive Auction Authority - Tips?

catinjapan on 18/11/2014 - 16:24

Hi all,

Does anyone have any tips from experience as to what one should be aware of when signing a standard Exclusive Auction Authority form for VIC?

My conveyancing solicitor is unable to give me advice on it other than "it's a nasty document that only protects the rights of the agents". Of course! That'd right!

I'm negotiating to pay advertising fees only on the sale of my property. I'm also adding in a commission structure to to incentive the agent to sell it on this side of Christmas, with a slightly lesser commission from January onwards.

Any sellers or even ("good") agents out there, what are your experiences or tips?

Thanks :)

Financial

Comments

  • mushroomsoup on 18/11/2014 - 18:07
    +1

    The Exclusive auction authority is a signed document supplied by the RIEV that allows the agent the sole right to sell your property until the authority lapses. Even if you introduce your own buyer during the period that the Authority is active, the agent is still entitled to his/her commission of the sale of land.

    What commission structure were you intending to use? and what exactly do you mean "pay only advertising"?

  • catinjapan on 18/11/2014 - 23:21

    Commission structure:
    2.2% incl. GST plus 15% on whatever surpasses the reserve if sold before 31/12/14, if after, then that 15% is reduced to 10%.

    Advertising:
    Pay advertising upon the sale of the property and not upfront.

    • mushroomsoup on 19/11/2014 - 00:53

      Paying advertising upon the sale of the property is standard. Of course unless your property doesn't sell and you choose to take it off the market or change agents then you will get the bill for marketing.

      What you have to understand is that the Exclusive Auction Authority is there to protect the agent/agency. It is essentially a contract that gives them exclusive rights to sell your property within a given time frame. If the authority ends and your property still hasn't been sold then its up to you if you want to remain with them or change agents.

      Take for example, if you didn't sign the authority and the agent still proceeded with selling your property and introduced a buyer to you, that buyer could return behind the agents back, make you an offer which you could accept, you wouldn't have to pay commissions or marketing. The only thing you'd probably have to pay for is a solicitor.

      I probably didn't word it in the best way possible but hopefully you can understand where I'm coming from.

      Keep in mind that in Victoria, commission is always negotiable. The incentive structure is 1 of 2 ways commission can be paid (the other being flat percentage).

      If you don't mind me asking, which area were you selling in Victoria and which estate agency?

  • catinjapan on 19/11/2014 - 07:10

    Hi mushroomsoup, thanks for your comments. I tried to PM you but it says you don't accept private messages.

    Although incentives are negotiable, considering my property is an apartment and not a $1m+ property I don't mind paying the incentive.

    Have you sold yourself and can offer any further advice or tips? Would be much appreciated.

    • mushroomsoup on 19/11/2014 - 09:38

      I've changed the settings to allow private messages.

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