When it comes to selecting a Realtor, numerous misconceptions abound. Let's dig into these, explaining why some metrics might not be the best benchmarks and offer you a more informed approach to make your choice.
Flawed, Frequently-Asked Questions When Interviewing Agents:
1. What is your sales price vs. asking price ratio?
Using the distance between the sales price and the asking price as a yardstick for an agent's performance is flawed. The asking price is, at best, an estimate, and it's often influenced by the seller's personal expectations, which can vary widely.
2. Which agent will suggest the highest price for my house?
For many sellers, their first question is "How much can I get for my home?" Although it's pivotal to understand potential returns, this shouldn't be the lone factor in choosing an agent. It's essential to discern the reasoning behind the price they suggest. Consider the uniqueness of your location—are you in a high land value zone? Is your neighborhood undergoing a redevelopment with new construction? The agent should recognize these intricacies and understand the math behind the development and how that impacts the price of your home.
Moreover, remember that property markets are dynamic. Between your initial discussions with an agent and the actual listing, market conditions can shift. Thus, it's wise to reassess pricing closer to the listing date to reflect the most recent market data.
If too much importance is placed on selecting an agent that suggests the highest price for your home, you may find someone who doesn’t excel on all other metrics and is giving you an inflated price to win the listing.
3. Should I select an agent because they already have a buyer for my property?
When selling any item, greater visibility typically results in better outcomes.
For instance, if you were to sell your car, would you only showcase it to your neighbors on your street or list it on a digital platform? A digital platform would expose you to more buyers and likely get you a higher, more accurate price.
The same logic applies to houses. An expansive buyer base often results in better offers. While some exceptions arose during the pandemic's heated markets, it's rare for the listing agent to represent the potential buyer for your property directly.
For residents of states like Texas, where dual agency is prohibited, agents claiming to have buyers for your property should be viewed with caution. The question arises: Whom will they truly represent—your interests or the buyer's?
It's disheartening when sellers, after hearing of a potential buyer from the listing agent, select this agent only to see the buyer vanish after there is a listing agreement in place. Sellers who select an agent based on this hope can find themselves listed publicly weeks later because the initially mentioned buyer didn’t materialize.
4. Should I select an agent that says they specialize in my area?
Sometimes yes, sometimes no.
Some agents might only close 5-7 deals per year, all within a specific area, and claim specialization. In contrast, another agent might handle 50 transactions city-wide, including 5-7 in your neighborhood. The latter, with a broader set of experience, is often better equipped to handle unforeseen challenges.
Instead of asking about area specialization, a better question might be about the percentage of the overall transactions they've handled in your locality. This offers a clearer picture of their market familiarity. An agent that has done 5-10% of the volume in your area in the past few years is very familiar with the pricing and likely has other colleagues that contact them for upcoming inventory in the area. This helps you as the seller to work with a local area expert.
5. Should I pick an agent who is newly licensed or a friend who does real estate on the side?
Choosing professionals based on personal relationships isn't always wise. Just because my husband excels in data science doesn't qualify him as my go-to tax consultant. Likewise, I don’t want to have a friend do my taxes who “does taxes on the side.” I respect the value my CPA brings to me, and I respect the value a professional Realtor brings to a transaction.
If the consumer perceives Realtors as adding little value to the home selling process -- thinking that all they do is put a sign in the yard and enter the property in MLS -- then they may undervalue the breadth of a seasoned agent's services. This makes it more likely that a consumer will select an agent for their personal proximity rather than research for a deeper skill set.
It's imperative to research agents, ask about their process, determine that this is their full-time employment, examine their past clientele, and read reviews. Making an informed decision when selecting a Realtor is akin to choosing any other professional. The right Realtor can offer invaluable insights, reinforcing the importance of their role in property sales.
Great Criteria to Use When Finding the Ideal Realtor for your Property Sale:
1. Sales Record:
The volume of homes an agent has sold can indicate their proficiency.
Experience finely tunes an agent's skill set, and an agent who sells a great deal likely has a well-honed process.
2. Operational Years:
Seasoned agents, having navigated through various market conditions, are equipped with invaluable insights into market behaviors, which can only come with time and experience. While length of time in the business doesn’t always mean proficiency, it can indicate experience with many different market situations, which can be valuable to you as a seller. An agent who has a good feel for a market can better give you meaningful risk-reward perspectives while negotiating for the sale of your property.
3. Their Process:
Always ensure that there's a comprehensive plan in place. Inquiring about an agent's process provides insights into their diligence. It's a misconception that Realtors merely put a sign in the yard and list properties on MLS. Their preparatory work, before the actual listing, is extensive. Grasping the depth of this pre-listing process can reassure you of their capability to handle your property's listing adeptly.
4. Local Transactions:
Although I earlier cautioned against relying on area specialization, understanding the proportion of their deals in your locality can be insightful. An agent with a high transaction rate in your area probably knows the region intimately. They will also likely have an expansive network, enhancing your property's visibility. Our team is known for working in Hyde Park and Barton Hills in Austin as I have lived in both places for long stretches of time. This means that colleagues contact us to inquire about off-market inventory that we may have coming up. In addition, our colleagues come to us with questions which puts us in a better position to have more information about these areas.
5. Reviews:
Reviews are a great source of information. Of course, you want to know that an agent has plenty of 5-star reviews, but you can also read between the lines in the reviews and see if this agent offers the type of service you are looking for. Are you an engineer and want to be sure someone has the financial and mathematical savvy that is important to you? Read agents' reviews and look for the nuance of their process and character in their past clients' words.
6. Referrals:
Consult friends and family. When selecting a CPA for an attorney or a house painter, referrals are always a great source of information. Great agents get 80% of their business from repeat referrals. Your friends and family have someone they have used and had great experiences with. Ask around and then use the interview questions suggested here to see who feels like a good fit for you and your decision-making style.
7. Team vs. Solo Agent:
Both team and individual agents have their merits. Well-structured teams can offer diverse expertise, ensuring all aspects of your listing are meticulously handled. Determine who will handle critical activities like contract negotiations. Senior agents, aided by support staff, can concentrate on networking and promoting your listing, while administrative tasks are managed by their team.
Expanded Resources:
Whether you sell now or never, we are always happy to be a resource for you!
Jen
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