real estate

Part 1 – What Buyers and Sellers Should Know About Real Estate Agents

For most buyers and sellers the prospect of dealing with a real estate agent brings forth unknown fears. While some agents are genuine and reputable and consider their clients best interest as their top priority, there is no dearth of unscrupulous individuals either who are just trying to make a quick buck at someone else’s expense. As a buyer or sellers of a property, it is your responsibility to choose a real estate agent prudently. So, here is a look at what you should know about real estate agents before you approach one

What does a real estate agent do?

Depending on which side he is working for (the buyers or the sellers), the realtor acts as an intermediary between the buyer and the seller and helps to complete the sale of a property. For his services, he is offered a commission from his client (seller, buyer or both). When working on behalf of the seller, the real estate agent is responsible for putting the details of a property in the multiple listing services of the area and undertaking other efforts such as home staging to market the property.

In case of a residential property, a real estate agent may start off by putting up the details of the property on his personal or company website depending on whether he is a part of a realtor firm or works on his own. The next step would be to market the property through postcards and advertisements in real estate magazines offline as well as online.

Besides marketing the property, the agent who lists your home is also responsible for following up with other agents who might have clients that may have expressed interest in the property. An agent is also supposed to help you negotiate the best deal possible. He/She is with you every step of the way till the home is sold; advising you on all matters including procuring the services of a lawyer.

The agent does not charge the client/home seller for his marketing efforts; however, you will have to incur any legal cost involved in the selling process

When working from the seller’s side, a real estate agent is responsible for rummaging through the property listings of an area that his client is interested in. He coordinates with the real estate agent handling the property on behalf of the seller and arranges to show the premises to his clients. A real estate agent from the buyer’s side also helps to negotiate the best deal for his client and is with the buyer through out the purchasing process. He is also responsible for approaching a professional to get a property evaluation done. Some real estate agents may also offer other services such as advice and help for procuring home loans.

Real estate agents not only earn commission from the sale and purchase of homes but also when a property is leased. Usually the commission is paid to the real estate agent at the final settlement of the deal.

Who should you choose to be your real estate agent?

Real estate agent can don three mantles that of an intermediary on behalf of the seller, the buyer or a dual agent. When buying a house, it would be best to hire the services of an agent who can work on your side, the same holds true when selling a home as well; you would be better of approaching a real estate agent who works for sellers.

Although real estate agents who work from the sellers or the buyer’s side do not have different credentials, some agents choose to play on a single turf while double agents may work for both the seller and the buyer simultaneously earning commissions from both.

The Sellers Real Estate Agent: An agent working on behalf of the seller will have his loyalties towards his client an he/she will try his hardest to convince the seller to give his client the lowest deal. So, as a buyer if you were to ask the seller’s agent if his client would accept a higher deal, he will be obligated to not divulge this information to you.

The Buyers Real Estate Agent: Similarly agents who work on behalf of the seller owe their responsibility to their clients and will try to get their clients the highest deal possible. So, they will not be willing to offer information on how low their client will go in terms of the price.

A dual agent: A dual agent is obligated to keep the honest picture in front of both parties; since he is entitled to a commission from both parties, he owes his loyalties to both the buyer and the seller.

Most real estate agents have a list of buyers as well as sellers so it is not unusual for an agent to work on behalf of both parties or at least get another agent from his real estate firm to negotiate on behalf of the seller or the buyer.


The problem with real estate agents

While real estate agents are in the business of marketing properties, it is not uncommon for them to play up their credentials; after all, it is a dog eat dog world and there is certainly no dearth of real estate agents in the market. While this is acceptable, some individuals resort to lying blatantly about their accomplishments and often their customers end up paying for their tall claims.

So, make sure that you check all the claims that are being made by a potential real estate agent. Do not hesitate to ask for references. If he has not mentioned his experience in the brochure, make it a point to ask him about it. Also, inquire about other properties that he may have sold which were similar to the one that you want to sell/buy; this would include properties in the sane area, of the same size and price range.

Finding a good and reliable real estate agent can save you a lot of trouble while hanging out with the wrong guy can quickly turn into a nightmare so take your time when picking a real estate agent to buy/sell your home. Look out for tips on how to select a real estate agent in the next article.

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Part 2 – How To Select A Real Estate Agent

Buying a home can be an expensive prospect so it is imperative to choose every person and factor involved in the deal with the utmost care. A real estate agent plays a vital role in the sale or purchase of a property and if you choose the right guy to work on your behalf he can not only make your life infinitely simpler but can also help you to save/make thousands.

The first step is to of course choose an estate agent who fits the purpose; for instance, if you are the seller, you need to work with a seller’s agent while for purchasing a home; you should go with a buyer’s broker. There are those professionals who take care of both tasks; that is, they may work on your behalf as well as that of the other party. Agents who work simultaneously for the seller and the buyer are known as dual agents. As a seller, if you approach an agent who works on your side, he will be obligated to get you the best deal possible; so, he will never divulge information on how much you are willing to negotiate and what is the lowest offer that you would be willing to accept. It will be your agents endeavor to get you the highest price possible.

On the other hand, when you work with a buyer’s agent while purchasing a home; the agent will be committed to getting you the lowest possible price. So, he will never make the buyer privy to information on how high you are willing to go in terms of the price. As you can see, these two positions work against each other; the buyers gain is obviously the sellers loss and vice versa. So, you can imagine that a real estate agent who works on both sides has to be honest with both parties and inevitably the buyer and the seller would find out sensitive price related information. So, ideally you would be better off working with an agent who works exclusively on your side.

However, this is just one part of the equation when looking for a real estate agent; there are several other factors that should be considered when hiring the services of a professional or an establishment that offer real estate brokerage services. Here is a list of some important aspects that should not be missed

Call the agent’s bluff: Almost all real estate agents have the propensity to brag about their accomplishments, which is fine as long as there is at least some modicum of truth to their claims. Remember these guys make a living out of marketing people’s homes so it’s not particularly difficult for them to market their own services to clients. There are some real estate agents who are more concerned about establishing their reputation as reliable and honest professionals and they do not like to inflate claims; on the other hand, there are those who would be quite happy to take unsuspecting clients for a ride for a few bucks. So, make sure that you check everything that the agent says he has accomplished. Some common areas where the agent may try to sell more hype than truth are listed below and you should watch out for these

The inexperienced expert: It’s fairly easy to come across real estate agents who have dozens of listings on their website; these are often a ploy to impress clients. After all, more listings would equate to more experience and that can be a highly valued commodity in this business. Make sure that you go through the website with a magnifying glass in hand; you may just find it mentioned in fine print that the dozens of entries are actually office listings. This would mean that even if the broker is working for the company with the listings he may not be personally responsible for handling all the customers. He may very well be the new kid on the block with not more than a client or two to his credit. So, it is operative to ask pointed questions here; after all, the real estate agent is going to charge you for his services, so why shy away from looking for the best. If you see several listings ask the agent, if they are all his or if other agents from the establishment are also involved in serving the clients mentioned on the site

The specialist who knows little: It is also not unusual to find agents who brag about being the specialists of certain areas and particular types of real estate; for instance, condos, HUD properties or even commercial real estate. A real estate agent may also mention that he as an expert when it comes to certain types of real estate transactions. However, you need to understand that these claims may very well be wishful thinking. Just because an agent aspires to be an expert in a certain area of real estate selling/buying; does not mean that he actually is an expert. If you find a professional who boasts of being a specialist of a certain neighborhood, take a look at his listings. There should be at least a few entries in his area of expertise.

Also, ask about any deals that were closed by the broker in the area. A good real estate agent who does indeed have the claimed experience will not hesitate to give you the specifics such as name of the client, property and transaction details and the contact information of the buyer and the seller.

Can’t see that crucial piece of information: This is another common technique used by some real estate agents; concealing information. They automatically assume that what you don’t know can’t hurt you; well, in this case it can and will. So, once again scrutinize all the information offered in the marketing material and on the website. A very common habit among real estate agents is to lie about the number of years they have been in business. Now, if the claims have been exaggerated by a year or two there is nothing to worry about but if they real estate agent goes overboard and tells you that he has a decades worth of experience helping people to buy and sell homes; you need to check this out. If this information has not been listed on the site or in the marketing material, talk to the agent openly about it. Besides, the demeanor of the agent will usually be enough to tell you about his experience.

However, it may also be worthwhile to remember that anything above two years should be acceptable as long as you find an agent who is friendly and honest. A friendly agent who is willing to understand you specific circumstances and work around them but has just been in business for two to three years will be able to clinch a deal faster for you than a grouchy guy with a 12 years of experience in his kitty.

Generic Answers: An agent who generalizes a lot of answers and information can prove to be the bane of what could have otherwise been a successful real estate deal. The property market is all about specifics and the agent needs to have pertinent and precise information about the important figures. If your agent cannot help you with answers to simple questions about the median price in an area, the number of days on the market and inventory, he may not be the right guy for the job. Remember in real estate deals, the devil is firmly in the specifics and details; so, you cannot possibly entrust your real east ate buying/selling needs to agent who cannot handle details too well.

Look at testimonials and references: If the agent can refer you to a past client who he/she has worked with; this would be a sure fire way of establishing how effective the agent is. Ask for the contact details of previous customers so that you can get in touch with them. A testimonial right out of the client’s mouth can be worth more than a thousand glowing compliments on the marketing material. If you do not see the name of previous clients next to the testimonial on the website etc, ask for them.

Not all agents make up testimonials, some are happy to offer references with the permission of their previous clients. So, when you take the names and the contact details of ex customers, inquire if you can call them; a reliable and reputable agent should have no problems with this.

It is also important to remember that sometimes a professional may not be trying to deceive you intentionally; however, ignoring some crucial information may lead to an expensive misunderstanding. So, take the time out to ask relevant questions to a prospective real estate agent before handing him the job

Should you deal with a buyer’s and seller’s agent from the same company?

A lot of people have a question about the suitability of working with a seller’s and buyer’s agent from the same company. Ideally, you should not do this; there are several reasons why hiring two guys from the same organization may not work in your favor.

Too much information: Because these guys work for the sane company, chances are that they will exchange notes on you and the last thing you need is to have you personal circumstances discussed casually between the employees of a firm

Professional rivalry: Since the guys work for the same company; there is a possibility that they may not be particularly friendly with each other. In a worst case scenario, they may be out rightly hostile towards each other. At the end of the day, this professional rivalry will impact the outcome of your real estate deal so it’s best to avoid such murky scenarios.

Too friendly: There may also be a case in which the two agents are a bit too friendly with each other for your good; they may not agree to an interview simply because they do not want to step on each others toes. One or both of them may also decide that they do not want to compete with each other. Again, you will be at the receiving end here.

May not want to reveal the tricks of the trade: Because they are working for the same organization, one or both agents may be extra sensitive about guarding their business tactics. So, they may not be very comfortable discussing or negotiating on your behalf with their colleagues

So, all in all, it would be best to approach people who do not work for the same company. It would be worthwhile to understand that while most agents are accepting of the fact that a client or two gets lost and that there is no pleasing everybody; losing a client to a colleague who works for the sane organization may create a significant issue

Why should you go with an experienced real estate agent and how much experience is enough?

The adage “90% of the work is done by 10% of the people” holds true in the real estate market as well. You will find that most of the deals are clinched by a select few estate agents who have been consistent and diligent about their work. An experience of 5 plus years along with a deal rate of ten per year which is almost equal to one deal per month is what you should ideally be looking for. There are; needless to say, several advantages of hiring the services of an experienced real estate agent which include:

• Will be able to offer recourse and solutions based on past experience
• Enjoy good camaraderie and rapport with other agents
• Can anticipate problems before they occur based on their experience
• Have strong negotiation techniques that will help their clients to save or gain thousands
• Understand the intricacies of ten real estate market and its changes
• Can refer reputable vendors such as title companies, mortgage lenders, home inspectors, contractors, appraisers, pest inspectors etc
• Can offer crucial statistics on the real estate market
• Will be able to guide you to smooth and glitch free deal closure.

Also, it is imperative to not hire DNA agents (relatives who work as agents). Althoguh they may have you best interests in mind, they may often not speak up out of fear of offending you even when you are headed towards imminent failure.

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