Not all homeowners understand the benefits of hiring a real estate agent, and we hope that this article and infographic will make it a little bit easier to understand why you should not buy, nor sell a house without the help of a real estate agent.
You should also read our article with 42 tips on how to sell your house fast
Hiring a real estate agent will cost some money when the transaction goes through, usually a percentage of the final sales price, however, they more than make up for the cost in everything they’re helping you with. To read why you should use a real estate agent when you’re buying, scroll down below the infographic.
The benefits of using a real estate agent or realtor are many, and a good one will be worth their commission and more.
This infographic can be reposted or used free of charge as long as you include an active link back to this page.
Benefits of Using a Real Estate Agent
You may be able to go with one of the other services that will help you sell your home, rather than using a real estate agent, but you should know that you won’t get nearly the same assistance, and you should be ready to do a lot more of the work, if you choose to do that. There will also be a lot of things that you need to think about yourself instead.
You might be able to save money like that, if you’re lucky, but you won’t get all the profound knowledge that an agent has. If you’re either selling or buying a house for the first time, there’s a lot of stuff you just haven’t gone through yet, and we strongly encourage you to go with a realtor in that situation.
It is one of, if not the biggest investment you will make in your life, and it should be done on the basis of good decision making. You need it done right more than you need to save some money when the sale closes. You can make serious mistakes without an agent.
Difference Between a Realtor and Real Estate Agent
What is the difference between a real estate agent and a realtor? Even if the two are often used interchangeably, there is a difference that you should be aware of.
Being able to call yourself a person dealing in helping buy and sell real estate is a regulated market, and the different titles have different meanings.
In order to be a real estate agent, you will need to get the appropriate license, and you can’t simply get the license in one state and then also buy and sell in another state. If you want to do business in another state, you also need to obtain the necessary permits there.
It takes a lot before you’ll be able to call yourself a real estate agent. A lot of tests and classes that need to be passed before you can get your license.
A realtor is a real estate agent who did not just obtain all the necessary permit but this person is also part of the National Association of Realtors. This association has grown over time, and it currently has more than 1.3 million members. They also have certain standards for the organization, which includes a code of ethics.
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 brokers can either be a principal broker, managing broker or associate broker – read more here. They typically have more experience, but the down side is also that they might be more busy and not have as much time to deal with your specific transaction.
No matter which one you choose, you’re a lot better than doing a FSBO.
Reasons to Use a Real Estate Agent When Selling Your Home
There are a lot of resources that will guide you through a FSBO, but you should remember that you’re still not experienced in the field of selling homes. An agent is. Here are the most notable reasons to use a real estate agent when you’re selling your home.
- Price guidance – the agent knows what comps sell for. They have an understanding of the price per square foot, and can help you make sure you don’t price your home so it will sit in the market for a long time, and not so low that you are leaving money on the table. With an agent, you will probably sell your home for more.
- Best financing options – agents know the local financing possibilities and a lot of them have preferences among the financing options they would recommend for you.
- Access to a wide network of professionals – since they have been selling homes for a long time, they know who to call when it comes to necessary remodeling projects, smaller repairs, roof inspections and more, and they can recommend you the types of repairs they believe are needed. They know which repairs will increase the price of your property more than they cost.
- They are equipped with marketing experience and techniques – agents have been marketing homes for a long time and that is just one of the reasons you should choose to use one for your own sale. With the knowledge they have, they’ll be able to make sure people show up for the open house, if you have one, and they know how to get the house in front of potential buyers.
- Multiple listing service – as a person without a real estate agent license, you don’t have access to the MLS, and if you want your home posted on there, you will need someone with a license to post it there, which will greatly increase the amount of exposure your property gets.
- They can help with the paperwork – they deal with paperwork every day, and they know what should be in there, and what is a deal-breaker. There will be a lot of paperwork for you to deal with, and it’s best to have the guidance of an agent to help you efficiently navigate it.
- Have access to hundreds of homebuyers – agents have been working in the industry for several years and have built up a network as a consequence. They probably already know someone who is interested in a property exactly like yours.
- Advertise your home and highlight its important features – do you know which things you should focus on with your property? No, well, a real estate agent will know, and that way when the home is being shown to possible buyers, you will focus on the right things. They know what a specific buyer is looking for, but they also know how to market it to the masses.
- Spot any potential problems – if there are any potential problems coming up, they will be able to spot them early on and address them the correct way, so that they are still manageable.
- They are professionals in handling negotiations – they know how much your property is worth and they are able to help you with the negotiation when it comes down to talking about the numbers. They make sure that emotions do not take over, and can give you objective advice. Check these negotiation tips when you’re selling your home.
- Incentives in selling a property at a higher price – since their commission is tied to the price of the house, they will also want to sell it for more. It encourages them to work harder on selling your property and get you the best price too. Therefore, you benefit too.
- They are aware of the rules and regulations – do you know all the rules regarding buying and selling property? If not, you’re not alone, and a real estate agente will help you, because they’re aware of the relevant rules.
- Quick sale – although you want the best price, you might also want to sell your home within a reasonable timeline. If you are in an urgent need to sell, they can help make that happen.
- Sell your property at a high price – according to the National Association of Realtors, homes that are sold without the help of an agent will sell for an average of $210,000. Comparatively, with the help of an agent, that number is $249,000, that is more than 15% higher.
- Professional handling – as a seller you want your case to not only go smoothly but also professionally. With the help of an agent, that is possible.
Why Use a Realtor When Buying a Home?
Buyers also have reasons to use a real estate agent, the same way sellers do. Rather than selling, you’re in the market to find the right property, and some will ask themselves if they really need an agent. Even for people buying, there are advantages.
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
If you choose to use a real estate agent who is also part of the National Association of Realtors, they’re ethically bound to help their client in the best way that they can.
- Getting the right price for the home
While this is also the case for sellers, agents helping buyers will be able to tell whether a property is over-priced or not, and if they believe there is more room in the negotiation. They know all the comps and how much they sell for and will also help you get the best deal.
- Requesting Repairs From Sellers
When you’re about to make an offer, it is quite common that certain repairs will be dealt with by the seller, and this is where the agent can also help you in getting the best deal there. They know the right home inspectors who can point out all the right things, making the seller feel like he owes it to you to have the repairs made.
- Finding Homes That Match Your Wishes
There are a lot of homes listed on services like Zillow and Trulia, but there are also some that aren’t. Chances are your agent will know about properties being sold before they get listed, and can match you with those to see if you have any interest in any of those. There may also be personal reasons why a seller would not want their property listed on those services.
- Helping with Paperwork
On the buyer’s side, the agent will also help you deal with all the paperwork that comes up, and make sure it is done right. That is how you ensure the sale goes through without any problems. This includes everything form the offer you will make to reading and understanding inspection reports and making sure that your requests for repairs end up in writing. If you’re not an agent, you probably have only limited amount of experience with the documents required when buying a home.
- Purple Room Phenomenon
Basically this is a phenomenon where a buyer has a very specific wish that he wants, and since the wish it’s very specific, and this may be a thing that it would be very hard to find if the buyer goes out by himself to look. In this case, the agent is better suited at finding the desired property and can help connect owner and buyer.
- Unemotional Kind of Negotiation
Even if you think you are not putting emotions into your decision of buying a house, you probably are. This is where the agent can step in and give you his professional opinion to make sure you are making a good decision.
We’ve made an extensive guide on negotiating when you’re buying a home.
- Code Expertise
You need to know about the different zoning laws where you’re wanting to buy, because certain areas cannot be used for whatever purpose it is you wish to use them for. Some areas do not have commercial zoning, meaning your opportunities for starting a specialty store there might not just not be available. The purpose you need the house for will also determine where you are able to buy.
- Spotting problems that will cause problems with the closing
When you are getting closer to buying a property, that is when you really don’t want anything to go wrong. There are many problems that could arise, and if you have a good real estate agent, that person would be able to spot these problems and make sure to take necessary action so that closing will not be a problem.
How to Find a Real Estate Agent
There are different ways to go about finding the right real estate agent, and naturally you need to find the right one. This is the one that will take the time to explain all the necessary details to you, who seems professional and who you believe will get the job done.
But how do you go about finding an agent, when they’re all promoting themselves in different ways? Which one is really the best one for you to choose?
- Start by talking with clients they already worked with.
You can ask the agent about references so you’ll be able to speak to some of the people they have previously worked with and hear what impressions they had of working with that pro. Take the time to call each of the homeowners on the list.
- Check the licensing.
Since each state has different license requirements, you will want to make sure that a prospective real estate agent is licensed in the state you’re in. When you have received the agent’s license, go to ARELLO and make sure it’s valid for the state you’re in.
- Find someone with a proven track record
You are going to want someone who has been around the block before, and has helped a lot of clients, yet still someone who is ready to take the time to sit down and help you out. It could even be that the one you choose has been nominated for or received award such as the Realtor of the Year award. Here’s a list of the Realtor of the year for 2017.
- Select the agent that has the right credentials.
The same way that you want other professionals to have the right credentials, that is also very much the case when it comes to real estate agents. Additional accreditations will mean that they have taken the time to do more training and get even better at their job.
The following are some of the accreditations you can look for.
You should also find out if the person you’re talking to is a member of NAR.
- Look at how long the agent has been an agent for.
While you don’t necessarily need to person who has been doing it the longest, you naturally get better over time. A solid track record is more important than having 15 years of experience, but you will at least want someone who is not new to the trade.
- Check their current listings.
How many other listings do they currently have? Go online on their website or ask them about their other current listings. Since people generally start looking for houses online, you will want to hire someone who has a solid online presence, and can communicate well with prospective buyers.
It is also an advantage if they have experience in the price range you yourself are in. If so, that may be the price range they have the most experience and contacts in too.
- Ask about other houses
Since you want a good agent, you want one that knows the area well, and what is currently for sale. An agent who knows what is currently being offered around you is clearly someone who has done his research.
Questions to Ask Real Estate Agents
We will summarize the most important ones you can ask. When hiring an agent, you will want to hire someone who focuses on what it is you’re trying to do. Some agents will even exclusively be buyer agents or seller agents. Ask them how big a percentage of their current clients are buyers or sellers, depending on your own needs.
What are the neighborhoods you work the most within?
Can I get a list of references that I can contact and ask about you?
What is your track record in the neighborhood I’m looking to buy or sell in?
If we work together, will I work with you or an agent working for you?
Do you have enough time currently to take me on as a client? You don’t want an agent who is simply too busy currently to do a good job with your case.
While this is by no means an exhaustive list, we encourage you to check out the different websites at the top of this section to help ensure that you ask the things you want to ask when you meet with an agent.
Do I Need a Real Estate Agent?
By now we hope that the answer to the question of whether you need a real estate agent or not is yes, at least in our opinion. While these transactions can be done without the help of an agent, a first time buyer won’t know all the steps included in the process. If, despite of this article, you decide to go about doing it on your own, we encourage you to at least do a lot of research beforehand.
If you have any other benefits of using a realtor that were not covered in this article, make sure to send them along to us.