27 Benefits of Using A Real Estate Agent When Buying or Selling a Home
Are you considering whether or not it is worth the cost paying to have an agent sell your home? This infographic gives you 15 benefits of working with a real estate agent when you’re selling your home, and the full article below gives you even more reasons to keep going with a profressional. You may have been thinking there aren’t enough good reasons to use a real estate agent and have to pay the commission, but these benefits should convince you otherwise.
Make sure to also check out this infographic if you’re needing to sell your home fast.
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Benefits of Using a Real Estate Agent
These days, it’s not hard to find online services and websites that assist sellers and homebuyers in completing their real estate transactions. With so much information easily and readily available, a lot of sellers and homebuyers have been wondering if hiring an agent is necessary.
Although doing the work by yourself can surely save you a significant amount of money since agents usually ask a big percentage for their commission, for many, going solo might not be the best way to go. This is especially true if you are buying or selling a property for the first time. You might just actually end up spending more than what you could have paid for the realtor’s commission.
Selling or buying a new house is one of the biggest financial undertakings we all make in our lifetime. Thus, it is important that we make sure that we do things right from the start. The best way to this is to work with people who are experts in the field of real estate.
Whether you are selling or buying a home, here is a comprehensive article about real estate agents and the benefits of hiring them. These are the different topics that will be covered more in depth.
Difference Between a Realtor and Real Estate Agent
If you’re new to the real estate market, you might find several different titles of a real estate agent confusing. Sometimes, people use these interchangeably, however, there are actually lots of important differences between the roles of the different professionals involved in the real estate industry, from real estate agents, realtors, real estate brokers, etc.
The real estate profession is actually regulated by the state governments in which different requirements are needed in order to acquire a certain license. Generally, the titles that you could come across with are the following:
- Real estate agent – this is someone who earns a license to assist people in buying and selling properties, whether their license is a broker, associate broker or sales professional. The requirements from one state to another will vary greatly, although in all states, it is required that you take a minimum number of classes and then pass certain tests in order to acquire your license.
- Realtor – this is a kind of real estate agent who is part of the National Association of Realtors and this means that he or she has to uphold with the standards of the organization as well as its code of ethics.
- Real estate broker – this is a person who has earned some education way beyond an agent level, as required by the state laws and has passed the real estate broker’s licensure exam. Brokers can choose to work alone or hire agents who can work for them.
Although you will be more likely to work with a real estate salesperson directly or through an associate broker, there are some brokers that offer services for both the sellers and buyers themselves. If you hire an agent who can help you in buying and selling a property, such agent will typically report to the broker. The broker will then handle the earnest money deposit and then establish an escrow account.
Moreover, the broker will bear the responsibility for the action of the agent that is under his or her supervision. Although the majority of the real estate related transactions would go through smoothly without any glitches, the broker could step in if in case there are any issues regarding the purchase or sale of a home.
If you’re not happy with your agent and you cannot seem to resolve the issues directly with them, the best thing that you can do is talk to the broker. Perhaps, you can also have the broker look for another agent that you can work with.
If you are in need of a real estate professional to hire, it is a good idea to work with one of the members of the National Association of Realtors. These professionals are committed to maintaining the professionalism of the real estate industry. You can also choose to work with a broker or a salesperson, although in any case, you must take time to interview your agent and ask for references.
If you wanted to work with someone who is new to the industry, you might want to request to meet with the broker as well so you will feel comfortable with someone who has the right experience and can best represent your interests.
Do I Need a Real Estate Agent?
It is unfortunate to know that in this day and age, a lot of people still do not trust the agents and do not really understand the importance of hiring one. But this is pretty understandable.
Quite frankly, some sellers and buyers could manage well on their own, without the need to work with an agent. But if you are new in the industry and you do not have the luxury of time to do all the selling or the buying, you might be able to benefit well from the services of a real estate professional.
As a seller, it’s possible to find your own buyer without having any agent. However, you cannot be guaranteed that you will be able to easily find the right buyer. In the buyer’s market, there are only a few buyers, and this makes the agent’s services even more important.
As a matter of fact, more than 80 percent of homebuyers would hire the services of a real estate agent to find the right property to buy. If you will forego hiring an agent, then you will not have access to this 80 percent of buying population. It can be pretty hard to sell your property to the remaining 20 percent of the buying population.
Another good reason for hiring a real estate agent is because they can help bring added value to any real estate transaction, whether it is selling or buying a house. Except if you routinely attend each and every open house that is going on in your neighborhood, you might not have enough information regarding the interiors of the houses in your neighborhood and you will not know why others are being sold much cheaper than other similar properties.
Experienced agents have this knowledge and will use it to position your home to be sold at the highest price possible. Below are some of the services that most of the agents can offer to the sellers:
- Wide exposure to online customers.
- Topnotch marketing resources and proven selling systems.
- Professional photography and virtual tours.
- Promotion during MLS meetings and company meetings.
- Networking through fellow real estate agents.
- Price guidance based on the recent sales forecasts and market data.
- Inspectors, home stagers and repair contractor referrals. Check out our guide with +70 home staging tips.
- Confirmation of potential homebuyer qualifications.
- Expertise on negotiation and counter offers.
If done the right way, the job of the homebuyer’s agent is to always put the buyer’s interests on top of their interests and to disclose all of the material facts, while keeping all buyer’s information confidential. Furthermore, the agent will also help to provide the buyer with enough information to buy a new home and negotiate expertly on behalf of the buyer. Here are some of the services that an agent can offer you when buying a new house.
- Provide sales data coming from MLS based through map searches.
- Provide comparable sales reports coming from tax rolls.
- Pull out property profiles that reflect property data, sales history, neighborhood services, demographics, etc.
- Obtain copy of the historical documents of a certain property.
- Run reports on the list price of the listing agent to the sales-price ratios.
- Calculate annual trends and facts of a certain area.
- Suggest pricing strategies.
- Review documents for any loopholes and acquire disclosures.
Reasons to Use a Real Estate Agent When Selling Your Home
Perhaps you are one of those people who do not see the need to hire professional real estate agents. Well, you better think again, for there are actually lots of good reasons why you should seriously consider hiring real estate agents. Here are some of them.
- Price guidance – professional agents know the market so well and will make sure that your property is priced right. This can greatly help your property to sell quickly and at a good price. Remember that if your property is left in the market far too long, some potential homebuyers will think that there is something wrong with it and they will not be willing to pay for the fair price to get your property.
- Best financing options – if you have decided to invest on the necessary repairs for your home, the agent can help you in finding the best financing options.
- Access to a wide network of professionals – if you hire agents, you can rely on their wide network of industry professionals like home inspectors, who are able to easily spot any problems in your house during an inspection. The agent can help to figure out which of the repairs are really worth the cost and will advise you on what are the necessary repairs to be done and which ones are unnecessary.
- They are equipped with marketing experience and techniques – agents are equipped with the best knowledge and the most updated marketing techniques on real estate. With these knowledge and skills, you can be rest assured that they are a pro when it comes to selling homes.
- Multiple listing service – hiring an agent will allow you to be able to take advantage of the MLS or the Multiple Listing Service, which helps in increasing the exposure of your home property for sale.
- They can help with the paperwork – another great benefit of working with realtors is that you can get help with the processing of huge amounts of paperwork and you can even be guided on what needs to be done, what to be aware of, etc. This is really very helpful especially for first time home sellers.
- Have access to hundreds of homebuyers – since agents tend to help both the sellers and the buyers, hiring the agent will therefore give you access to a wide network of highly qualified homebuyers.
- Advertise your home and highlight its important features – an agent can help in advertising your home to potential buyers and will even highlight the best features of your property. These professionals are very much aware of what the homebuyer will usually be looking for in a house so they will make sure to highlight these features of your home and will make your property appear more attractive and appealing to potential buyers.
- Spot any potential problems – experienced and professional agents could easily spot and address any potential problems in your house. They will make sure to deal with these before putting your home on sale as these issues might just stop any potential sale from pushing through.
- They are professionals in handling negotiations – an agent would be the best people who can help with the negotiations during the sale of your property. They take emotion out of the transactions, unlike the homeowners who tend to become emotional at the thought of selling their property. The agents can even offer objective advice on the various aspects of the negotiation processes and will initiate with the professional negotiations with the buyer. Check these negotiation tips when you’re selling your home.
- Incentives in selling a property at a higher price – the commission will normally depend on how much the property was sold for. It will therefore encourage the agents to work hard at selling your property at the best price possible so they can get good commission out of the sale as well. In this case, it is not only the agent who can benefit, but you as well.
- They are aware of the rules and regulations – a professional agent will make sure to be on top of the latest regulations and rules in the real estate market, most especially in terms of selling homes.
- Quick sale – certain situations might require that you sell your property quickly. Perhaps, you are in urgent need of money, etc. In this case, an agent can help you to do just that.
- Sell your property at a high price – according to the National Association of Realtors’ statistics, the homes sold by homeowners themselves are at an average of $210,000. However, home properties sold by agents are sold at an average of $249,000.
- Professional handling – most homebuyers want the process of buying a new home to be as smooth and professional as possible. This can only be achieved if you hire professional real estate agents. Indeed, working with agents can help to put homebuyers at ease when buying new homes.
Why Use a Realtor When Buying a Home?
Homebuyers, not just the sellers, benefit as well. As someone who looks for a potential property to buy, you might find yourself wondering – do you really need to hire an agent to be able to buy a new house?
During tough times, a lot of people are looking for ways on cutting down costs as much as they can. And when it comes to buying a new house, people would forego hiring agents to at least somehow save some money. Agents usually earn 3% out of a sale price, thus, for a $100,000 home property, agents could take home $3,000 and this is about how much you can save for not hiring an agent.
Sure, you can shop a property by yourself and you could even get a peek of the property inside if you want to, without the need to sign a deal with any agent. However, unless you have the luxury of time to do home shopping and make it like your part time job, then hiring an agent might be a good idea in finding that perfect home property faster. In fact, hiring a realtor when buying a house comes with so many benefits and here are just some of them. Make sure to also check our guide on buying a house. Without further ado, here are the reasons to use a realtor when buying a home.
- Ethical Consideration
Although not all of the agents belong to the NAR or National Association of Realtors, those who are would have to agree to abide with the realtors’ code of ethics. The code basically stipulates that realtors will need to deal with all of the parties of any real estate transaction as honestly as possible. Furthermore, the code obliges the realtors to put their client’s interests before his or her own. Moreover, the agent is required to make full disclosure about any problems in the property and be as truthful with their advertising.
It is the NAR that enforces the provisions for the code of ethics. Penalties could include a fine of $5,000, suspension for one year from the association or an expulsion. How frequent this usually happens is not clear. Since the local boards will handle the enforcement actions, no statistics on penalties against the realtors have been available.
- Expertise on Pricing
Most of the agents could set a price on a certain home property by the time they walk into your door. If they got lots of experience in the real estate market, then they will know the neighborhood so well and how it holds its value too well.
Although anyone can pretty much spend a few minutes online and gather enough information regarding the home properties nearby, including details about the sales of comparable houses, the ‘agents are well experienced and are fully aware if such a specific house is underpriced or is just overpriced. In the best situation, an agent will have a good idea of the property you are looking for and will not waste your time by touring you to houses that will not even work.
Not only can the agents provide you with all the necessary data regarding home sales that you wanted to see, but they could also bring in some properties to deal, coming from their years of observing so many real estate transactions within the neighborhood.
- Requesting Repairs
Usually, the touchiest part of any real estate deal will involve the delicate process of requesting for repairs. An agent could easily identify any trouble you might not see yourself, and will recommend a reliable home inspector who can provide a detailed report on issues regarding the house you are interested in buying.
The inspection reports can be several dozens of pages long and within these pages, some issues indicated are important while others are not. If the house you intend to buy is not in a reasonably good condition, then you always have the option to request for repairs, which can either make or break the deal.
Your agent will have a good sense of what would be more reasonable to request and which ones are just excessive. In most cases, it all will all depend upon you as the buyer. The agent could read the situation and will be able to suggest anything that will work best for you. Each and every buyer will have a different tolerance on what they will need to do.
- Looking for Any Available Homes
Although most home properties that are listed for sale are widely available for homebuyers to access on some websites, in some cases, the sellers will not want the fact that their property selling is being publicized widely. In these cases, only the professional agents are aware that these particular houses are available for sale.
Sometimes, people just do not want their property to be actively advertised online. This may be due to some particular reason, such as personal, or they simply do not want their friends and family to know that their house is being put up for sale.
Other reasons for privacy are financial problems, health problems, etc. There are also instances wherein people do not want their property listed during holidays. Either way, hiring an agent is a great idea as they can get you access to some properties that you could miss seeing if you search for properties yourself.
- Tackling Any Paperwork
If you have ever bought a house before, then you have probably dedicated an entire shelf somewhere for the documents that was involved in the transaction. These could include the paperwork on written offer, inspection reports, signed counter offer, including the little details such as specific repairs and what else are included for the sale transaction. The paperwork could be tiresome.
A good agent can help you with all the paperwork involved. Usually, the counteroffers and offers have limited time frame. The agents are usually armed with fax machines, and given the good economies, will not stop churning out paper.
The possibility of missing something, not checking a box, not initialing a margin, could drop substantially if you are working with someone who is very much knowledgeable on all the paperwork involved.
- Purple Room Phenomenon
Aside from all the technical aspects involved in a sale as well as the mistakes people could make in terms of handling the paperwork, the agents are also well adept at the neighborhoods, as well as the home properties inside and out. Industry experts would refer to this as the purple room phenomenon. If the buyer would like a house that has a purple room, the experienced agent is aware which of the houses that are offered for sale has that in a room.
Generally, the agent will be fully aware of the features of the house, which will not otherwise be shown in the Internet. If you are looking for a particular house that has a room that can be converted into an office, or perhaps, an attached unit or room for your mother in law, the agent will be most likely to find this for you, instead of relying on websites.
- Unemotional Kind of Negotiation
No matter how levelheaded you think you are, when you end up fighting with a seller regarding adding a hose at the dishwasher since the water will drain into the floor, it is pretty easy to lose your cool during the process. Hiring a good agent to write the requests objectively and then forward them to the seller can save you from all the trouble of becoming overly emotional about a particular deal.
For instance, the seller will not budge with the dishwasher hose and you just want to adjust the offer you make. The agent could handle this pretty calmly. Experts have also advised that you should let the agent to take the heat during negotiations that are just too much for you to handle.
The best way to make a deal is to look for something positive in every counteroffer and offer made and do not ever allow the other party to see you making that sour face. A lot of times, the most effective way to do this is to have your face represented by the agent.
We’ve made an extensive guide on negotiating when you’re buying a home.
- Code Expertise
If you wanted to purchase a charming little house located somewhere near a business district and then convert the front parlor into a candy store, you might first need to know if the local code will allow such things. Ideally, a professional agent is knowledgeable with the local zoning ordinances and they will make sure that you will not end up buying the wrong property.
In the same way, if you wanted to build a fence at the backyard, or perhaps, add a bedroom, the agent can help to ensure that you are buying a certain property where the city will allow such thing to be built. In addition, certain cities might require that you make some expensive upgrades on older home properties once they sell.
For instance, if a certain house is not at all connected to the sewer system of the city and the buyer will need to spend tens and thousands of dollars in order for the property to be connected, the agent will need to ensure that the requirement is disclosed right before the deal can go too far.
- Thorough Keeping of Records
Although agents are not really lawyers, they could serve as good resources several years after the deal is closed. In certain states, licensed agents will be required to keep full files of all the documents in various transactions for several years
While you must and should keep important files yourself, you can rely on your agent to keep everything organized and secured in the event that a trouble crops with the property even after several years to come. You can also call your agent anytime in the coming years just in case you have some concerns or you have some questions regarding the property and all the transactions involved.
- Avoid Any Closing Problems
If a sale is near closing, all sorts of pitfalls could kill the deal until the final hours. A professional agent knows how to watch out for any trouble before it will be too late. For instance, if the title of the home property is not clear, and some long lost relative is listed on the title that has not even signed the sale. Or perhaps, the lender is causing some trouble by not meeting the timeline required for the financing.
Once you are getting close to the closing, you may want to make sure that there are not any unexpected issues on the property title and that the financing has come through and all of the professionals involved are staying on task within the timeline. Agents are very much used to dealing with these kinds of issues and they can work through any challenges that could arise.
How to Find a Real Estate Agent
When it comes to looking for a real estate agent, you obviously need to make sure that you will end up finding the best in the industry. However, with agents presenting themselves through online ads, yard signs, direct mail postcards, and other mediums, how else can you ensure that these agents are truly the best? Whether you are a seller or a buyer of a property, here are some ways on how to find the best agent to hire.
- Talk to some recent clients.
Ask some of the agents you have gotten in touch with for a list of the recent clients they have worked with. Ask them to provide you with list of listed and sold properties in the past year, including contact information of each of these clients.
Call each of these customers to find out how they feel about working with the agent, whether they are particularly disappointed or pleased with their services. You may also want to ask about the asking price of the properties or what the sales price was.
If you are selling your property, find out if the previous properties they have sold are similar to yours, in terms of location, price, as well as other salient features. Remember that your goal is to find someone who specializes in the same type of properties you are selling. Another good question to ask the agents is how long they have been in the business of selling homes.
- Check the licensing.
Each and every state will normally have a license for professional agents and the licensing requirements will normally vary from one state to another. It is a good idea to check with the regulatory body of your state to find out if a certain agent is licensed and if there have been some complaints and disciplinary actions filed against them. This information can also be found online.
- Choose someone who is a winner in the field.
If you really want to work with the best in the industry, consider looking for someone who is a winner in the field. This means that he or she has received certain awards given by prestigious organizations. Perhaps, he or she has earned the Realtor of the Year award, given by the local state department or by a branch of the NAR. These agents are certainly the best in the industry, as proven by these award-giving bodies.
- Select the agent that has the right credentials.
If doctors have specialties, so does the real estate agent. Even the generalists will require additional training on some areas in the industry. Thus, the specialty after an agent’s name is an indication that such person has undergone certain classes on a given category of the real estate industry. Here’s what the designation an agent will mean:
- Certified Residential Specialist or CRS – this agent has completed the necessary training required for handling all residential real estate concerns.
- Accredited Buyer’s Representative or ABR – completed the necessary education that represents buyers for all sale transactions.
- Seniors Real Estate Specialist or SRES – completed the necessary training aimed at assisting sellers and buyers of home properties who are aged 50 and above.
If the agent will refer to himself or herself as a realtor with capital R, then this could mean that he or she is a member of the NAR. By hiring the realtor, the most important thing you can get is an agent who will formally pledge to support the real estate’s code of ethics.
- Research how long the agent has been in the business.
The state licensing authority will normally advise you on how long the agent has been in the business. You can also ask the agent directly about this. If they have not been in the industry for at least five years, then they are trying to learn from you, which may not be good.
Ultimately, what you need to look for is someone who is engaged actively in a certain area of the real estate business and offers services within your price range. You should choose an agent who can demonstrate knowledge of the homes and neighborhoods within your range and can show you the kind of market presence that they are involved in.
- Check their current listings.
Take time to check the current listings of the agent online. The best places to look are the agency’s website, and other sites that offer searchable online database of properties that are in the MLS or Multiple Listing Service. Most buyers will normally start their search online and thus, you need to make sure that you hire an agent who knows how to effectively use these online tools and resources.
Check how closely the listings are similar to the property you wanted to buy or sell. Are they within the same area and is the price range similar?
- Ask about the other houses that are also being offered for sale nearby.
A good agent knows about the other area properties available at a certain area at the top of his head. Simply mention a certain property in your area that has been recently sold or is being offered for sale. If such agent is familiar with these properties, then this could indicate that he or she is familiar with the area and is really doing a great job.
Questions to Ask Real Estate Agents
There are lots of homebuyers who tend to spend a good amount of time hiring agents. However, many of them can choose their agent in less than an hour only. According to real estate experts, almost half of all homebuyers hire the first agent that they have met. But if you really want to make sure that you are getting your money’s worth when it comes to hiring the right agent, then here are some of the questions you need to first ask them.
- Are you doing this as a full time job? If so, how many clients have you served in the previous year?
Remember that you want to work with a real estate agent who is not easily distracted with their obligations and who is an active agent that is more likely to be updated with the current state of the real estate market. Of course, you also need someone who is very much familiar with the law.
- If clients are not happy with your services, can you identify the usual reason behind this?
Asking why the client is not a good fit for the agent can also help you in figuring out if you will be a good fit for the agent as well.
- Have there been any complaints filed against you?
If you are not comfortable asking about this, check with the licensing board of your local state.
- How many property sales have you dealt with in those neighborhoods I am targeting?
It is important that you choose an agent who is very much familiar with the local market and have some recent property deals in the same area or neighborhood where you want to buy a property.
- How much do you charge for service fees?
The seller will normally pay the buyer’s agent coming from the money that you will pay for the home property you are buying and usually, 3 percent of the sales price will go to the agent. There are some buyer’s agents who will refund a certain portion of this fee.
- When will I be committed to you?
A lot of customers will start checking out homes without knowing that this will actually obligate them to work with the agent, whether there has been a contract that’s been signed or not.
- Are there any other people who will be working with me?
An agent will normally work with a team. However, the person you will hire must do most of the work. It is best to know this ahead of time so ask your agent who else will be working with you for the transaction.
- Can you show me all of the available properties for sale?
Reliable agents will be more than happy to show you all properties, including those properties for sale by homeowners.
- How many short sale transactions and foreclosures you’ve handled in the past?
Distressed properties can also turn out to be a great deal, however, the paperwork involved could be very complicated and your liability will be greater when it comes to this. The best agents have wide experiences in closing deals with these kinds of properties through the banks.
- How quickly can you help me find my home?
Hot properties will normally move fast. Thus, find out how the agent will handle property tours within a short notice only.
- What sets your services apart from the rest in the neighborhood?
Check out the expertise of the agent and not the eagerness. You are not hiring just any kid in the neighborhood who can rake leaves in your yard. You are hiring someone who will help you in making one of the biggest purchases in your life.
- Will you represent sellers and buyers on the same home property?
- What happens if I am not satisfied with your service?
Agents are paid when you purchase a home property. However, most customer complaints will normally occur during the property closing process. Therefore, it would help if you ask about guarantee.
- Can I ask for references of clients you have made the last five deals?
Most of the home buyers will be more than happy to share their experiences. Therefore, ask the agent for references so you can interview their previous customers and decide whether the agent is indeed fit for the job.
Remember that agents have clients that they serve well. However, the best agents are those who have served almost their entire clients pretty well. Requesting for a list of the agent’s last five clients can help to give you a more balanced picture of how he does his work than allowing him to choose his own favorable references.
Take time to call at least two of the references that the agent gave you. Ask them the same questions you have asked the agent. Get to know each of the last five deals and see how they will compare with similar property sales within your targeted neighborhood. Above all, find out if the real estate professional was able to negotiate a good deal for his or her past customers.
The agent should treat each and every client with utmost professionalism. This means that the agent should always be on time on all meetings and transactions and that they should be able to address all concerns in the most professional manner. This is why it is important that you hire the agent who has acquired the right knowledge and skills through proper education.
Keep in mind that the agent that you will hire will serve as your representative for every transaction, whether you are selling or buying a home property. As soon as you have signed up with any of the agent you have interviewed, he or she will be your advocate, your voice, as well as your defense against all of the transactions and processes involved in the buying or selling of a home property.