Selecting The Right Realtor® to Represent You
Selecting a Realtor to represent you is a decision that should not be taken lightly. We recommend that you take the same care as you would in selecting any other professional such as an attorney, accountant, doctor, dentist, investment advisor, etc.
Too often sellers make emotional or impulsive decisions that cost them money and time. In selling or buying real estate, there is typically a lot of money at stake. You should hire someone that you can trust, is skilled at negotiating real estate transactions and can get you the best deal, thus saving you a significant amount of money.
To assist you in selecting the best person or team to represent you, we have developed a "Listing Agent Interview" form that you can use to interview prospective Realtors.
There are a number of mistakes sellers make when choosing a Realtor. Don't let yourself fall for one of these:
"My friend sells real estate, I've given him/her my listing."
Friendship alone isn't enough to establish a professional's credentials. Use tough standards when selecting an agent, just as you would when hiring an attorney, a doctor, or an accountant to handle your taxes. A true friend will understand and appreciate that this is a business decision and will offer their credentials and expect to compete for the listing. If your friend happens to be the best qualified, then by all means let him or her represent you. If not, hire the best person for the job.
"I'm hiring the agent who works for the largest company."
For the most part, real estate agents are independent contractors who work for themselves - they are their own company., You are hiring an individual agent, you are not hiring a company. Real estate agents need to be affiliated with a real estate broker who can process their transactions, but they are not employees of the real estate company. It's up to the individual to determine what actions they are going to take to get the maximum exposure for your home and how much money and time is going to be spent marketing your property. Real estate companies make their money by hiring as many agents as they can, as they get a portion of every real estate commission the agents affiliated with their company earn. So don't be fooled by marketing hype that says that the "XYZ real estate has sold more than another company." Focus on the success of the individual agent and his/her team - regardless of the real estate company.
"You've suggested the highest selling price for my home, you're hired."
Some agents tell you what you want to hear. In the real estate profession, this is known as "buying a listing" and is employed by shortsighted agents who are more interested in themselves than they are in you. It may be a good short-term "sales tactic" to get your listing, but it is an extremely poor strategy. Your property must be priced properly to get it sold.
"I'm going to list with a discount commission company to save money."
You get what you pay for. Paying a cut-rate commission will often get you a sign in the front yard and placement in the Multiple Listing Service, but little additional effort from your agent.
Realize that agents put up their own funds to market and advertise your home. Marketing and advertising costs money -- the lower the commission, the less incentive for an agent to put up his or her own money to market your home.
Incentive plays a very important role in sales. A "full service" agent earning a full commission will often "drop everything" to handle any challenges that come along - an agent earning a small commission does not have that same incentive.
Incentive is also important to the buyer's agent. Since there are almost always two agents involved in every sale, they split the commission according to the listing agent's instructions. One agent is your listing agent. The other agent is the buyer's agent. When your listing agent dropped his commission, did he also reduce the commission that will be paid to the buyers' agent? If so, you won't find as many agents willing to show your house - they'll be showing houses that offer a customary commission to the buyer's agent.
Finally, negotiating ability is an important skill in a listing agent. Are you willing to put your faith in an agent who can't even negotiate his or her own commission? These listings more often cost you money through lost time and lower sales price than saving any money.
Finalyy, ask yourself if you select any other professional based solely on price? If you're like me, I pay my accountant, doctor, investment advisor and others to get me the ultimate results I seek, and didn't select any of them based on their fee's.
"All Realtors passed the same test and know the same things."
Real estate is a business and those who work in the profession vary greatly in their approach to running their business. A real estate license is a minimum bar that every realtor must meet - from that point, individual practioners differ greatly in their knowledge and approach to their business.
Conclusion
The best agent is the one who will do the most effective job of marketing the property, negotiating the most favorable terms and conditions, and communicating with the seller to make the process as smooth as possible.
