Concept of Exclusive Mandates increasing in India and how is this worthwhile
Selling your home is possibly the most imperative personal investment decision you are likely to make in your lifetime. Therefore when negotiating its sale, you will consider it vital to conclude a successful transaction, measured in terms of the price achieved. Your preference of real estate agent and the method of marketing and selling your property are of paramount importance and will undoubtedly affect the financial success of the sale.
When it comes to deciding whether to opt for the Exclusive Mandate route or to go open listing route, the Exclusive mandate is in best interests for clients and is indisputably the wisest choice, as it helps to achieve the best possible price the market will pay. This is because Exclusive Mandate – permitting only one agent to accomplish the sale – affords the agent the opportunity to work with and for you, never against, without the pressure and inherent disadvantages of several other agents also looking to sell the property.
Whereas open listing creates competition between agents to sell the property as quickly as possible before anyone else, irrespective of the price, it is the Exclusive Mandate method that allows your agent to create competition between the buyers to buy your home, thereby in most instances pushing the price to the highest levels and the best possible price the market will pay.
The seller who wants to give an Exclusive Mandate but is fearful of not attracting enough buyers through one agent, can be rest assured that – provided the chosen agent puts in the time and effort to market the property and advertises regularly to give it the widest possible exposure – prospective buyers will go to the agents with the best houses – there is little buyer loyalty towards agents If you look at newspaper property supplements it is possible you will find the same property advertised by different agents, asking varying prices and giving a variety of reasons for the sale. Even though this is without the seller’s permission, the damage has been done!
Not only can this cause confusion and uncertainty, it can also create an incorrect perception in the minds of buyers that the sale is urgent and desperate, As a result, it more often than not attracts offers at nowhere near real market value.
It’s about commitment! The agent asking you for the Exclusive Mandate is really promising and undertaking to give you 100% of their commitment to get you the best possible price that market will pay. What they are really asking is for you to give them 100% of your commitment in return!
In India, with a low entry barrier that Real Estate has, we find anyone and everyone doing Real Estate directly or indirectly. Just to gain more business, many agents end up giving discounts to their customers and these discounts impact on the post sales services offered by these Agents. On the same hand, at RE/MAX we train our Associates on getting and promoting “Exclusive Listing and Mandates”. An exclusive mandate not only safeguards the associates time and interest in the listing but also helps in getting the best possible price in least possible time through dedicated advertising and marketing of the listing. Exclusive Mandates have worked beautifully for our Associates as well as customers. The customer does not have to go to any other Broker during that time frame and the Associate dedicates all his resources towards that particular listing. For a Broker, It’s always good to have 10 exclusive mandates then to have 100 open listings. Indian real estate is moving towards being a mature market like the western countries. In countries like US, Canada, the client has to mandatorily go for the exclusive mandate route to get the deal done. Being a part of the Global brand RE/MAX, we have our own knowledge base and diverse experience. We preach and practice the same in Indian market as well. We have had small victories where our Associates have successfully got mandates and also shown better results.
Exclusive mandates are not a new concept even in the Indian market. International Property Consultants (IPCs) are already working on mandates in the commercial sector. RE/MAX has pioneered in the residential side of taking mandates from the sellers. We in fact have also been successful in taking buyer mandates as well. This is not very common in the Indian real estate market. To bind the buyer with the associate for a specified period of time and let single broker market is property is only possible when there is a lot of trust involved between the buyer and the agent and we as RE/MAX have been able to establish that client broker relationship based on Honesty, Integrity and Candor. By getting a Mandate from either client, we as RE/MAX make sure that the service provided to the client is no less and we do not hesitate to put in our time, money and effort in getting the best deal for the client.