This article was published on 10 July 2004. Some information may be out of date.

QI have come to the conclusion that you are anti the real estate industry. After 31 years in the profession — and yes, that is my choice — I do not believe we deserve your comments unless you can justify why fees should be less.

The increase in the fees over the years is based on the inflation level of the homes, for which vendors get the benefit. Inflation also increases costs as well.

I have often suggested to a vendor that they pay me on an hourly rate if they think the fees are too high, and they also reimburse me for advertising and petrol. I have not yet found one who will test that theory.

With reference to Guido (an agent who accepted Money Matters’ challenge to list houses for a flat $4,000 commission), I do not consider seven listings to be a great hit rate, given what he was offering.

But it is about on a par with REAL when they came in with low commissions and went under six months later. This gentleman is not a well known person in the area and only time will tell if he is around in five years time.

REAL based their system on the Scottish one. This person talks about the Dutch system. I thought we were in New Zealand.

I am proud of what I do, and believe I earn my money. I have a lot of satisfied customers who have appreciated my efforts enough to use me again and again, so I respectfully suggest you give us a break.

AI’m not anti your industry. I’ve used agents for my last four house sales, and been reasonably happy with them.

But the letters keep flowing in from others who are angry, or who have done very nicely thank you without using an agent.

Other points:

  • Real estate agents are among the first to say that house prices rise faster than general inflation.

    And, in fact, they do rise on average about two percentage points more than inflation — which adds up over the years.

    What about your costs? I would guess that they have risen roughly in line with inflation. If so, you’ve creamed off the extra.

  • It’s a pity nobody has taken up your hourly rate offer. Perhaps they’re worried that you might spend hours bringing unsuitable buyers to their house.

    If an agent offered me an hourly rate, I would take it up. But they would have to account for their time.

  • On Guido, time will indeed tell.
  • As for Scottish and Dutch systems, bring ’em on, I say. I like the way most New Zealanders — if not you — are open to learning from other countries’ experiences.

    Having lived in three other countries where people tend to be less aware of what other nationalities do, I think this is one of our strengths.

QThis may come as a surprise to you but, as a real estate agent operating in West Auckland, I agree with nearly everything that you and your correspondents have said.

We used to run our agency the way most agencies are run, using auctions, vendor-funded advertising and open homes.

While we were becoming more and more disillusioned with that way of working, we could not see that there was any other method.

We were aware that auctions did not always get the best price, that vendor-paid advertising was there merely to raise the ‘profile’ of the agency, and that open homes were really there to find more sellers rather than find buyers. But that was just the way it was.

In June 2000, we found another method of selling. As a result:

  • We pay our salespeople $52,000 p.a. guaranteed plus $3,000 p.a. training allowance as well as paying performance bonuses. This has eliminated many of what we would consider the evils of commission-only selling.
  • We will not touch auctions, vender-paid advertising or open homes. All of our properties have prices on them.

I believe that we have about the best training going. And our salespeople must complete a six-hour written exam, which includes a number of ethics-based questions, as well as a four-day practical exam.

Finally — a note on that advertising!

I’ve asked a number of sellers how, as serious buyers, they would go about finding a property to buy. Invariably they have told me that they would drive to the area where they wanted to live, see whose signs were out there and see all the agents in the area. Widespread advertising is unnecessary.

I hope you have the space to print this as we are really trying to give the public what they want in the way of real estate service.

AThere you go. It can be done.

I do have one reservation, though. I’ve know of a few people who didn’t intend to change houses, but just popped into a neighbourhood open house out of curiosity. Next thing you know, they had bought it.

They certainly wouldn’t have driven around checking signs.

There seem to be so many different scenarios in the buying and selling of homes, that it’s hard to make definitive statements on what works.

QFor anybody who wants to track their money, spending, loans, net worth, bank accounts, investments and plans, I can strongly recommend Quicken, from

I have been using it since 1995 and have a total knowledge of my wealth, spending and income since I first began. It is awesome (not a word I use lightly).

AQuicken was most often recommended by readers who responded to Money Matters’ request a few weeks back for a programme to monitor investments. Others recommended other programmes, or doing it yourself using Excel and so on.

In total, 14 readers responded, and I really appreciate that. Quite a few went into considerable detail on what has worked badly and well, traps for young players and so on.

I had planned to run their replies, but there’s been so much correspondence about real estate, to say nothing of many other interesting issues that I hope to get to soon, that I’ve given up finding room.

Instead, I will email a word document of all 14 responses to anyone who emails me, at [email protected], putting “Money programme” in the subject line.

Please note that I haven’t tried any of these programmes, and I’m not endorsing them.

No paywalls or ads — just generous people like you. All Kiwis deserve accurate, unbiased financial guidance. So let’s keep it free. Can you help? Every bit makes a difference.

Mary Holm is a freelance journalist, a director of Financial Services Complaints Ltd (FSCL), a seminar presenter and a bestselling author on personal finance. From 2011 to 2019 she was a founding director of the Financial Markets Authority. Her opinions are personal, and do not reflect the position of any organisation in which she holds office. Mary’s advice is of a general nature, and she is not responsible for any loss that any reader may suffer from following it. Send questions to [email protected] or click here. Letters should not exceed 200 words. We won’t publish your name. Please provide a (preferably daytime) phone number. Unfortunately, Mary cannot answer all questions, correspond directly with readers, or give financial advice.