How Should Sellers Choose a Real Estate Agent?
How Should Sellers Choose a Real Estate Agent?
First, let’s cover how NOT to choose an agent because these are the 4 most common mistakes sellers make (but now you won't).
1. You should not select a friend or relative just because you know them.
If they are going to do the best job marketing your home, then choose them for that reason, if not, you need to do what is best for you.
2. You should not select the agent because they say they will get you the highest price for your home.
Your home is worth what a buyer will pay for it and the way to get the most money is to prepare the home to show as well as it can, pricing it correctly and marketing the home properly. The agent who does those things will usually get you the best price for your home.
3. Don't choose someone just because they tell you they have a potential buyer for your home.
When you list with the best sellers agent, any agent with a buyer can still show and sell your home, so that is not a reason to choose them to market it.
4. Don’t choose an agent based on commission alone. It’s not what you pay that matters, it’s what you have after the sale that matters. Low commissions usually equate to low service and low sales prices.
You want to choose an agent you feel comfortable with, but that is not the only criteria. The agent you select should be continually learning, you can tell this by their designations or certifications earned.
How a home is marketed has changed drastically over the last few years, largely due to the Internet. You want an agent that keeps up to date. You also want some who is trained in the type of property you are selling, whether it’s single family residential, luxury homes, condos, commercial, historic or investment property. They are marketed differently.
Of course, the agent’s job is to effectively market your home so it sells. More than 80% of time, the listing agent is not the one to represent the buyer. You are hiring them to market your property. Any agent can sell your home if it's listed with another real estate agent, that's the purpose of the MLS. Ask a potential agent about their marketing plan. It should include ways to market to the public and ways to market to agents. Some agents want to sell your home themselves so they don't have to split the commission and they don't market to agents. This is a common practice, but is not in your best interest.
No one has control of your homes location, neighborhood, incurable functional or external deficiencies, interest rates and the overall real estate market, but these things have an effect on the time it will take to sell your home and your actual selling price. You want an agent who has experience in the things you do have control over such as marketing, preparing the home for sale (staging), and determining the most realistic asking price. Most agents don’t have the knowledge of staging and the buyer psychology involved. Staging is not decorating or just making it “look good”, it is making the buyers feel like the home is “theirs”. It highlights architectural detail, reduces clutter, makes rooms seem larger through color and furniture arrangement, neutralizes décor, creates emotional connection points and de-personalizes the home.
The Internet has rapidly grown to be the most effective way of marketing a home. Choose an agent who is good at using the Internet to get maximum exposure. Other skill considerations are the knowledge and use of virtual tours, photography, ad writing and communication.
Commission rates among brokers are similar and seem to average around 6% to 7%. If you are asked for a higher commission, be sure you are getting the value for it in extra services. If you are offered a lower commission, be sure you know what you are giving up. It may sound like you will end up with more money, but if your home doesn't sell or sells for a lower price because you gave up valuable marketing, you don't end up saving anything. Better marketing and service usually result in better sales prices and may be worth the higher commission. Some properties such as luxury homes or investment property are more expensive to market and usually take longer to sell.
One of the most important jobs a real estate does for you is the negotiation after a buyer is found. This is difficult to know if an agent has the skill. Look for a certification like the CNE (Certified Negotiation Expert) or additional training in negotiation. Consider an agent who is a CRS – Certified Residential Specialist, only 4% of REALTORS® have been able to earn the CRS. It is the top designation for REALTORS®.
"A real estate agent has a high fiduciary duty -- a duty of trust and confidence" Donald R. Brenner, professor emeritus at American University. Consider choosing an agent who is a Realtor®. In addition to being licensed by the state to sell real estate, they belong to the National Association of Realtors® and must abide by a strict Code of Ethics. Brenner says, "The National Association of Realtors® has a code of ethics that will knock your socks off, and they are very strict in dealing with people who don't abide by them." Also, only Realtors® have access to Multiple Listing Services (MLS) through which members share listings and have access to many more properties than non-members.
Ask prospective agents about their marketing plan for your specific home, emphasizes Mitchell Herman, a Florida Realtor ®. "As a professional salesman, I interviewed agents who wanted to list my home and I asked them how they would earn their fee. They offered an undefined marketing plan and an MLS listing. That was it," he said. "If all a listing agent is offering is an MLS listing, he's not worth the commission."
Beware of comments like "I can get you more money for your home", "I already have a buyer for your home" or "I will list your home for the price you want" (assuming it is higher than what other agents have said). These are seller "hot buttons" and get agents listings, but they usually end up not helping you and worse, can cause you to lose money.
In summary, you want the agent you can work with that will price you home correctly, make your home look great online and in person, then market to as many qualified buyers and REALTORS® as possible. This will insure your home sells quickly and for the best price in can in any market.