Whanganui-Manawatū home owners prefer to list properties with real estate agents

The number of private sales of properties is dropping nationwide, with owners preferring to list with a real estate agent.

Home owners in the Whanganui-Manawatū region can expect to get 15 per cent more for their properties if they use a real estate agent rather than selling privately.

Analysis of agent and private sales by the Real Estate Institute of New Zealand (REINZ) and OneRoof.co.nz shows there has been a huge national decrease in the number of people choosing to sell their home without an agent in the past five years.

REINZ defined private sales as those not sold by a REINZ member, such as a member of the public selling privately or a real estate agent who is not a REINZ member.

In 2014, private sales made up 17 per cent of all residential real estate sales in New Zealand. That figure dropped to 13 per cent in 2017 and to just 10 per cent in the year to July 2018.

"Although this does not take into account the state of the house or off-plan developer sales, it is still a significant difference," REINZ CEO Bindi Norwell said.

"Even when commissions and fees are taken into account, the sale price shows a better return for the vendor when using an agent."

In the Whanganui-Manawatū region there were 157 private sales in the year to July 2018, compared with 1271 agent sales for the same period.

The median private sale price for the region was $265,000 while the median for agent sales was $305,000, giving agent sales a 15 per cent premium.

Norwell said home owners may not feel comfortable with the negotiating process and prefer to use an agent.

"Selling privately works perfectly for those who have the time, inclination, expertise, understanding of the regulations and patience to do so; however, for busy families, those without strong sales and negotiation skills or those who just don't understand the regulatory environment, then it might be better to utilise the skills an agent has," Norwell said.

"Selling via an agent also enables vendors to leverage the breadth and depth of an agency's expertise, technological capabilities and presence across a number of markets."

OneRoof.co.nz editor Owen Vaughan said: "Selling a home can be one of the most stressful and emotional things a person can do, even with an agent doing the hard part of marketing and negotiating with potential buyers."

Bayleys national residential manager Daniel Coulson said owners who think selling privately will result in savings because they no longer have to pay commission to an agent, fail to take into account that buyers will be thinking the same thing.

"The seller thinks they are saving money by not having to pay commission whereas buyers immediately take off that price before they make an offer," Coulson said.