Are you thinking about hiring a real estate agent but don’t know where to start? Many homebuyers and sellers decided it was the right choice for them. Roughly 88% of buyers purchased their home through a real estate agent or broker, according to research presented in the National Association of REALTORS® Profile of Home Buyers and Sellers.
Approximately 89% of sellers used the services of a real estate agent when selling their home. If you’re thinking of using a real estate agent, make sure you ask the right questions. Being in the dark about the process could complicate the process and lead to big headaches down the road. Here are 16 questions buyers and sellers should ask when choosing a realtor.
1. Buyers and sellers: What is your experience?
Before choosing a real estate agent, check to see that he or she has an adequate amount of experience. Purchasing or selling a home involves a significant sum of cash, so you’ll want to make sure you’re in capable hands. Also check the agent’s credentials to make sure he or she is properly licensed. You can look up an agent’s license number by conducting a search with the Association of Real Estate License Law Officials (ARELLO). Once you have the license number, conduct an internet search for your state’s real estate licensing division (for example, if you live in California, you would type “California real estate licensing division”). You can then verify the license by entering the license number.
Next: Don’t be afraid to talk about money.
2. Sellers: How did you come up with the listing price?
If you’re on the seller side, one thing a real estate agent will assist you with is coming up with a realistic listing price. He or she will make sure the price for your home isn’t too low or high. Good agents do a comparative market analysis so they can come up with the best price. During the analysis, the agent will review recent home sales in and near your neighborhood. They will also consider factors such as the condition of your home, the size, and the current housing market.
Next: Get a second opinion about the house you’re looking at.
3. Buyers: Is there anything about the home that concerns you?
Sellers want to get their home off the market, so they might not tell you everything you need to know (particularly the undesirable aspects of living in the home). The agent, on the other hand, will know a bit more about the property than you. Take time to ask him or her if there’s anything about the house that could be a potential problem. For example, does the home get very cold in the winter? If you’re in a big city, will guests have easy access to street parking?
Next: Make sure you know how the agent gets paid.
4. Sellers: How is your commission broken down?
When you sell your home, you usually pay a fee to the buyer’s agent as well as your agent. This fee is generally 5% to 6% of the sale price (roughly 2.5% to 3% goes to each agent). Find out what the agent’s fee is and what services come with that fee. In some cases, you can negotiate the agent’s commission. Buyers don’t usually pay the commission (although in some cases it is a possibility), but sellers will sometimes include the cost of commission by hiking up the listing price.
5. Buyers: Do you represent both buyers and sellers on a single transaction?
When an agent represents both the buyer and seller, this is called dual agency. Dual agency often presents a conflict of interest, so you may not want to work with an agent who is working for both of you. A dual agent can write the offer but can’t give you any advice when it comes to making an offer since the agent can’t advocate for you or the seller. You’ll want to know if you’re speaking to a dual agent, because if the answer is ‘yes,’ the agent may not have your best interest in mind. A better alternative to is to hire an exclusive buyer’s agent. You can find one when you conduct a search with the National Association of Exclusive Buyer Agents.
6. Sellers: How many sales have you made in and around my neighborhood?
Ask if the agent is familiar with your area. If not, you might want to consider finding another agent. An agent who is knowledgeable of the school district as well as nearby stores and amenities could mean the difference between a quick sale or a few more months sitting on the market. Buyers want to know if the features they want most are within reach, and they’ll want to know details.
7. Buyers: How long has this home been on the market?
Another important question you should ask is how long the home has been on the market. Even if you saw a listing on a website, there’s no guarantee the information is correct, so you’ll want to ask to make sure. Note that if the home is very new to the market, you’ll have less leverage when it comes to negotiating the sale price. Also, if the home has been on the market for a long time, you should ask why. It’s possible the original listing price was too high.
8. Sellers: What’s your marketing strategy?
Your home won’t sell quickly if no one knows it’s available. Word of mouth likely won’t be enough. Ask your potential real estate agent what his or her plan is to sell your home. He or she should have a strategy that includes online, print, and in-person advertising. If any one of these methods is missing, you might want to move on to someone who uses a variety of advertising methods.
9. Buyers: What are the terms of the buyer’s agency agreement?
Working with a buyer agent is beneficial in that the agent has your best interest in mind and is working only for you. However, once you decide to work with one particular agent, he or she will likely ask you to sign a contract that gives them the exclusive right to show homes to you (you might also have the option to sign a non-exclusive agreement, so ask about this as well). This contract is called a buyer’s agency agreement and it usually lasts anywhere from three to 12 months. You’ll want to find out the conditions of the agreement and when you’ll be required to sign an agreement.
10. Sellers: How long do your listings take to sell?
If you’re not in a hurry to sell, you might not be too concerned when it comes to how quickly your home moves off the market. However, if you’re looking to sell quickly you’ll want to know how long an agent’s listing typically take to sell. An agent who has listings that go fast is generally good at pricing homes and putting together an effective marketing plan.
11. Buyers: What if I am not satisfied with your service?
Things don’t always work out as planned. You might find that the service wasn’t all that great. Ask the real estate agent if he or she offers a satisfaction guarantee if you’re unsatisfied with the service provided. You could also request that your agent supplies you with a form called Termination of Buyer Agency. Once you complete this form, the agency agreement will be cancelled.
12. Sellers: What’s the best way (and time) to reach you?
The process of selling a home involves a lot of moving parts. You’ll likely have lots of questions, especially if this is the first time you’re selling a home. Knowing the best way to communicate questions or concerns, as well as the best times of day, will make your life a lot easier. Ask whether email, phone, or text is better, and inquire about how contact should be made if there’s an urgent matter.
13. Buyers: What are some things you like about this home?
Ask for the agent’s opinion on some things he or she likes about the home. This is helpful because it can be easy to miss some details during the exciting, yet sometimes hectic process of buying a home. The agent might mention some features or neighborhood amenities you overlooked. You might be so overwhelmed or distracted during the home tour that you fail to notice extra storage space, or your favorite store down the road, for example.
14. Sellers: What’s your method for following up with open house attendees?
A good agent will keep track of and follow up with potential buyers. He or she should know how many buyers were at your open house and have their contact information. This list will help him or her pursue leads and even get more information on what buyers think of your home. If the agent you’re thinking of working with doesn’t actively follow up with open house attendees, you’ll want to move on to another agent.
15. Buyers: Is this a reasonable price?
Unless you’re working with a dual agent, you should be able to get a fairly honest answer when it comes to the listing price. The agent will have access to up-to-date information about the neighborhood and recent home sales in the area. This will help him or her decide whether the seller’s asking price is within a reasonable range for the type of home you’re interested in based on the current market.
16. Sellers: Is this your full-time job?
You want to be able to contact the agent if you have a problem or concern. If the agent is juggling another job or two, he or she might be too distracted or busy to get back to you within a reasonable amount of time. You’d also have to worry about whether the agent even has time to update skills and stay on top of the latest developments in the industry. Make sure the agent you’re thinking of working with isn’t being pulled in too many directions to give you the level of service you need.
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