Blick article “What you need to know when selling real estate”

Beware of dubious Real Estate agents

It’s becoming increasingly rare for private individuals to sell their properties on their own. Often, the sales are entrusted to real estate agents. But not all agents are trustworthy. BLICK reveals what to look out for.

Anyone looking for a single-family home or a condominium will find very few listings from private sellers these days. Most listings are posted by real estate companies and agents. Of course, they don’t work for free, and—thanks in part to the construction boom—they’ve been making good money on property sales, especially in recent years. As a result, more and more real estate agents are entering the market, all wanting a piece of the pie. “Real estate agent” is not a legally protected professional title. Anyone can list properties on the market, advertise themselves as a seller, and collect commissions on any real estate sales.

Association with certified brokers

Nevertheless, there are ways to protect yourself from dubious real estate agents and to recognize dubious providers in the real estate market. Claude Ginesta, CEO of the real estate company of the same name, is vice president and board member of the Swiss Chamber of Real Estate Agents of the Swiss Real Estate Association (SVIT) and is involved in the committee for the professionalization of the real estate agent profession. He advises above all professional and proven providers who are members of the SVIT. Claude Ginesta: “Only real estate agents with a good reputation can become members of the Swiss Chamber of Real Estate Agents after a thorough examination. This gives them the Swiss seal of approval for the highest quality and performance.” If the association becomes aware of unfair practices by estate agents, they can be excluded from the association. “This has already happened, for example, because an estate agent received commission from the buyer and seller in a non-transparent manner. Sooner or later this comes to light,” Claude Ginesta knows from his work on the commission. The standard services that can be expected from a broker or the costs that can be expected are set out in a brokerage contract. Sample templates are available from the SVIT.

Private individuals sell too cheaply

If you want to sell a property, you don’t necessarily need a real estate agent who takes a cut of the sale. However, it takes quite a bit of time to put together and send out clear and complete sales documentation on your own, respond to written and phone inquiries, and conduct showings. At the latest when the sale is finalized, everything must be formally reviewed from a legal standpoint and notarized. “Investing in a competent real estate agent is worth it,” says real estate expert Ginesta. “Private sellers often lack the patience, the necessary negotiation skills, marketing and market knowledge, and the appropriate software to place their listings correctly with their target audience. They frequently sell their property below market value and lose more money than the real estate agent’s commission would have cost.” Whether selling privately or through professionals, Ginesta advises allowing about three to six months for the real estate sale. Regarding the approximate standard commission rate for reputable agents, Ginesta explains: “Depending on the location and property, agents earn two to three percent of the sale price.” From industry surveys, Ginesta knows that agent fees are less of a concern when it comes to choosing an agent. “Trust is more important. Recommendations from acquaintances can be helpful in this regard.” Ginesta also recommends checking references—for example, on the agents’ websites—and making sure that the Sales staff are familiar with the region.

Beware of excessively high real estate valuations

When it comes to property appraisals, he advises obtaining at least one second opinion. A deviation of ten percent in the property valuation is considered acceptable. “However, if a significantly higher selling price is promised than the bank’s appraised value, alarm bells should go off. Either the real estate agent has no idea about
appraisals, or he will recommend lowering the selling price considerably shortly after the contract is signed.” This is how dubious real estate agents often try to secure a property for sale before facing increased competition in the real estate market. It is therefore also important to ensure, when signing the contract, that the brokerage agreement can be terminated within a reasonable timeframe and without exorbitant costs if doubts arise or the Sales process is not successful. To this end, there should always be transparency for clients regarding the expenses incurred and the actual costs on the agent’s side. Ginesta: “Reputable agents therefore hold regular feedback meetings with clients during the term of the contract and present their reports to them.”

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