Real estate agents can guide you through the process of buying or selling a home. As with any profession, there are top-notch agents who do things by the book and lackluster ones who cut corners. Learn these lessons now to help you make better decisions later.
They sometimes work for both sides
In Minnesota, the same real estate agent can represent both the buyer and the seller in a transaction. It’s called dual agency, and while it may speed things up by allowing buyers and sellers to communicate with the same agent, it also can invite serious conflicts of interest. When they disclose dual agency, agents should explain what you’ll forfeit by agreeing to it, said Richard Harty, an exclusive buyer’s agent in Illinois.
They don’t know what your house is worth
Agents typically look at recent sales of similar homes and give you their opinion of your home’s value based on experience, but that alone shouldn’t decide your asking price. A professional real estate appraiser can provide the most accurate estimate of home value. Although it may cost around $300 or $400, getting an appraisal before you put your house on the market can help you set a realistic price.
Their commission is negotiable
Listing agents may expect you to accept their commission — generally around 6 percent of the sale price — without question, but you don’t have to. Negotiating the commission rate is completely within your rights, and you should discuss it before signing any kind of contract. Start by asking how much will go directly to your agent and the level of service you can expect in exchange for that commission.
They aren’t really sure an open house will help
In 2017, only 7 percent of buyers found their new home at an open house or from a yard sign, according to a National Association of Realtors survey. Buyers who schedule showings are almost always financially vetted, Bill Gassett, a Realtor in Hopkinton, Mass., said in an e-mail. Open house shoppers, on the other hand, may not yet be preapproved by a lender.
Their service providers aren’t always best
A home inspector, real estate attorney, title company or other service provider suggested by your agent isn’t always the best or most affordable option. Their recommended provider may be an acquaintance who may not work in your interest. Consumers should interview several potential providers and make their own decision about whom to hire, Harty said.