Buying or selling a house is a big deal. You need to make sure you pick the right real estate agent. There are hundreds of thousands of dollars on the line making this probably one of the most expensive transactions you will ever make. You need to get this right. Buying or selling a house can be very complicated (hello, paperwork!) Having the right real estate broker on your side is a must! You are in charge here and like any good boss you need to do your homework before hiring. I recommend that you Interview at least three real estate agents in your area. This post will guide you on which questions to ask and which answers to look for in the right person.
1. How many years have you been an agent in my area?
Okay, this is not the time to hire your best friend’s niece who just got her real estate license. God bless her, she will find her way and get experience but it should’t be at your expense. A good real estate agent will have at least four years of full time experience selling and buying houses in your area. If they have 10 or more years then you know you are working with someone who has had success. There are so many quirks in real estate which are only learned on the job after many years of practice. You may encounter problems related to liens, easements, wells, land permits and so on. Only a seasoned agent will be able to steer you seamlessly through the web of home buying and selling.
And it should go without saying, you should pick someone local. Only a local agent will be able to guide you on up-and-coming neighborhoods, best schools, neighborhood crime, price trends in the area, etc.
2. How many home transactions do you complete in a year?
Not to pick on your best friends niece again, but numbers matter. It goes back to experience. If someone has been an agent for years but they are only closing five transactions a year, well… they aren’t very experienced or successful. You should pick an agent that is at the top of her game. The top 10% of agents will sell 90% of the homes in your area. Find one of those! For most markets that will be over 30 transactions per year.
3. Who will be my primary point of contact?
Many successful agents work with a team that supports them. You don’t want to float around and not be sure who you should be talking with. Make sure you have one solid person to be in contact with at all times. Real estate transactions happen very fast, especially in competitive markets. Waiting three days for an agent to respond to a text, email or phone message is not acceptable but unfortunately all too common. The person you hire should give you one point of contact and guaranteed response time.
4. What qualities set you apart from other agents?
Most agents pass their real estate exam and the education stops there. A rock star agent will stay up-to-date on tax and zoning laws in your area. Agents who continue their education and become brokers are even better. They devote themselves to the highest level of education and are continually learning. If your agent is teaching classes and involved in developing other local agents you know you’ve found a good one. Some credentials an agent may have earned with continuing education include:
- Realtor®- Agents with this designation are members of the National Association of Realtors.
- CRS (Certified Residential Specialist)– These agents are at the top of their game. Only the top producing agents get this distinction.
- ABR® (Accredited Buyer Representative)- To receive this designation agents must complete specific training in representing buyers in real estate transactions.
- SRS (Accredited Seller Representative)– These agents have done extra training in representing sellers in real estate transaction.
If the agent you are talking to has any one of these designations then you are looking at someone who cares enough about their career to push their education forward and to stand out above the rest.
5. How will you help me buy or sell a house in a competitive market?
How much inventory is in your area? Is it less than two month’s supply? Your agent should know this. Are the homes on the market selling quickly? Are sellers getting multiple offers? Are there tons of cash offers?
A balanced real estate market will have a six month supply of homes available. Anything less than this and it is a seller’s market. Anything bellow two months supply means you are in a red-hot, super competitive market. This is not the time to call on an inexperienced friend.
If you are looking to buy, you will want someone who knows the area inside and out and–who is an expert negotiator. You many want to find out what their sale-to-list ratio is. You get this number by dividing the final sale price of a home by the asking price. Typically the closer this number is to 100%, the better. If it’s well over 100%, that means they are receiving more for a property than they asked for. If the number is bellow 100%, then they are pricing too high. Pricing correctly is an essential part of the job.
6. If you are a seller…ask “What is Your Commission Fee?”
In a real estate transaction the buyer typically doesn’t pay any of the real estate agent’s fees. The standard commission for a real estate transaction is 6% of the final closing cost of a home (due at closing) and usually split evenly between the buyer’s agent and the seller’s agent. This 6% comes out of the final sale price of your home.
Real Estate commissions can vary, this is why it is important to discuss real estate costs up front with your agent. I never recommend cutting corners when it comes to choosing a quality real estate agent. Remember, your goal is to net the most money, not to pay the least amount in fees. It’s always better for you to partner with the best agent you can find instead of the one with the lowest fees. The research shows that a full service local real estate agent will sell your house 20 days sooner and for 13% more money, thats why 89% of home sellers work with local real estate agencies like Prime Listings Group.
7. What will be the terms of our contract? Can I cancel without penalty?
A typical agent will want you to sign an exclusive listing or buyer’s contract which lasts for a specified amount of time. This is fair game as a good agent will likely be investing their own money into marketing your property. You should be looking for an agent that offers services such as professional photography, drone photography, professional home staging and marketing fliers. Be leery of an agent who wants you to sign a lengthy contract you can’t break but it allows them to get out. Some agents may charge a termination fee to cover out-of-pocket marketing expenses.
8. What is your preferred method of communication?
Do you prefer texting? Maybe you love talking on the phone or perhaps sending out quick emails is best? Make sure you discuss with your agent your preferred way of communicating and learn theirs. Things can change fast in a real estate transaction and good communication is a must. You don’t want to be missing out on crucial time sensitive information that’s sitting in your inbox just because you aren’t an email person.
9. How do you set realistic expectations for your clients?
We all want to sell our house for the most or buy our home for the least, but watch out for pie-in-the sky rainbow optimist agents. When it comes to buying or selling a home, you want a realist to guide you. Will they tell you your home will sell for $350,000 when other homes in the neighborhood are only selling for $270,000? Being positive is great but the price will ultimately be what a buyer feels is a good deal compared to other nearby homes. Make sure your agent keeps you grounded and sets reachable goals. A top agent will give you a price and comparable properties that have recently sold to justify that price. If the price they set is wildly different than comparable properties there needs to be a very solid explanation. A rock star agent will share tips for showing your home at’s its best so you can get the best price possible.
10. Can I contact someone as a reference?
Finally, if you want to know how good an agent really is, talk to their past clients. Listen to their personal experiences. Ask for the good, the bad and the ugly. If you ask an agent for a list of past clients and they refuse, then it’s time to say good bye. Be sure to look up any potential agents on Facebook, Yelp and Google Business to find reviews.
Amy Wagner is the founder of Prime Listings Group a real estate team in Snohomish County WA. If you are looking to buy or sell in our area fill out the form bellow. If you are simply searching for a rock star agent in your area, fill out the form or give us a call and we would be happy to send you a referral for a local rock star agent near you.