Most of the time, home sellers are tempted to find a buyer and directly sell their own homes. This may entail higher income because no commissions will have to be paid but, efficient and effective wise, it is not easily done.
A home seller will be surprised of the many advantages and costs they can save just by simply hiring a realtor. Read through the article to understand better the various kinds of agents, things an owner should know before contacting a broker and reasons to hire a realtor.
WHAT IS A BROKER, AN AGENT, AND A REALTOR?
Real Estate brokers are eligible when they have license; they can work as agents, but agents cannot work as brokers. Agents can give real estate advice if they have real estate license.
Real Estate Broker
Real estate brokers can work on their own or hire real estate agents as much as 20 agents. Some are called broker associates. Broker associates are also brokers but prefer to work for another real estate broker or a larger real estate network who sometimes give fix rate for their fee or a percentage of their transactions.
Real Estate Agent
As mentioned above, real estate agents are under brokers. They should also apply for Sales Agent license but cannot work independent from a broker, therefore, should be employed. Applying for Sales Agent License does not require a board exam like that of the Broker’s. An agent’s broker is the one responsible for the actions of the agent.
Any broker or agent can be referred to as a REALTOR® if they are members of National Association of REALTORS® (NAR). REALTORS® are required to follow their code of ethics and can be sued through local board if the realtor is noncompliant.
Other Types of Agents
The following are other types of agents: (1) Listing Agents, (2) Buyer’s Agents, (3) Dual Agents and (4) Transaction Agents. Listing agents are the seller’s agents. They have a fiduciary responsibility to the seller under listing agreement. Buyer’s Agents are recommended to be hired after a lead agent provides administrative assistants or transaction coordinators. Dual agents are agents who are both the buyers’ and the sellers’ and transaction agents can be described as professional assistants. They are neutral and provide third party services to both buyers and sellers.
THINGS TO KNOW BEFORE CONTACTING A BROKER to sell your house
Know how real estate commission works
It is important that home sellers understand this, so they can assess if the agent is asking too much and at the same time, plan properly according to the norms of home selling. Real estate commission usually costs 5%-6% of selling price. Both the Buyer’s agent and seller’s agent will be paid.
They will each receive 2.5%-3%. Both the buyer’s and seller’s agents are paid by the home seller, but the buyer will still have to pay the closing costs. Lower fees may be offered if the agent is a dual agent (both buyer’s and seller’s agent).
It is also important that the home buyer and seller dully understand the contract before they sign because if the time comes that they find a problem with their agent, it will not be easy to break up with them.
If the buyer decided not to purchase a home, they are not required to pay the agent because agents are paid at the end of the transactions. It is the same with sellers. Home sellers are not required to pay their agent if their home doesn’t sell.
Know the things to do before contacting an agent
A home seller should point if there is an existing mortgage on the house. If there is an existing mortgage, the home seller should know how much was paid and how much is still left.
Home seller should also know if there are existing liens or property disputes such as tax issues. There should also be no problem with the title especially if the property belonged to a deceased relative.
The house should also be clean and presentable when an agent inspects it. A dirty house can sometimes discourage agents to give high value for it. On the other hand, agents are encouraged to sell and motivated to market a house that is clean and presentable.
Let an agent inspect the house first before making improvements. It can be tempting to improve the things an owner sees fitting to improve but it is helpful to wait until the agent to see it because the agent knows what will attract the market.
The home seller should duly inform the agent about these matters before the house is listed in the market.
REASONS TO HIRE A REALTOR TO SELL YOUR HOUSE
Buyer’s agent prefers to transact with a realtor
Purchasing “For sale by owner” (FSBO) is usually the last recommendation that agents will offer to their clients. The only reasons why some agents recommend FSBO to their clients are the following: (1) there is no other inventory left, (2) the offer is extremely low.
Agents prefer to transact with professionals because not doing so signifies several hassles and risks such as sellers not paying the full agreed commission, or any commission at all considering that the agents were the ones who brought the buyer to the seller.
Realtors have time and expertise
Realtors can make themselves available each time buyers request ocular visits. Unlike when sellers attempt FSBO, it is difficult for them to rush home from work or from a meeting to see a potential buyer. At the same time, marketing one’s home at the end of a long work day is an added stress.
Not to mention, most owners are not experts in marketing homes. Unlike if there is a presence of a realtor. Realtors know how to sell homes to a diverse market.
Negotiation is a realtor’s expertise
Selling a home have specific mechanics that are very different from selling other properties or products. Negotiation is just a part of it.
If the property is being sold by the owner, the buyer’s agent can most likely easily negotiate the property at lowest price possible considering the experience and network that the buyer’s agent has.
If they cannot get the lowest price possible, its very likely that the agent will offer a different property to the buyer. Plus, FSBO sellers are not always familiar with the usual customs of the trade.
An owner who sells their own property has high tendencies to be emotional about the selling or negotiating process therefore leading to making poor decisions.
Unlike if there is a realtor, they can easily point out if the seller is being irrational with the things they want to negotiate.
Realtors have a large network
Even if an owner has a large personal or professional network, these people will most likely have very little interest to help the owner market the property.
Unlike with the presence of a realtor, they have a pool of potential buyers. Without this pool of potential buyers, the demand for the property is low which highly indicates that longer waiting time is needed for the property to be sold or worse, offering the property at much lower price than its actual worth.
Realtors know how to identify who the market are
Realtors have the expertise of understanding whether a potential buyer is qualified and serious to come to the point of purchase.
Through the realtor’s skills, they can easily find out if the buyer is just a dreamer or a curious neighbor. Time is wasted if it will be spent to potential buyers who are not serious in buying the property.
Realtors come handy to identifying real potential buyer.
Realtors know what the market wants
Agents see what sells to the market, or what the market is looking for. Agents can inspect the property the owner wants to sell and recommend needed changes for the property to attract buyers.
Agents also receive feed backs from buyers for more recommendations of fixing flaws for the property to sell at desired price and time.
Realtors know how to market the property
Agents will market the property aggressively giving high demand for it. This includes staging techniques and recommending professional-quality photographs to maximize the listing of the property.
Selling a property without a realtor has substantial risk of being sued
This is true most especially when it comes to the seller’s disclosure. Wherein all factors affecting the value of the property must be stated in the agreement. Otherwise, the seller may be sued for fraud or breach of contract.
Selling a property alone can help the owner save money. However, hiring a realtor with expertise and proper skill set will give the owner less stress and more advantages. The owner can be laid back but still confident that the property will sell at a competitive price and time.
So, what do you think? Will you sell your house at your own or do you want to ask help with the licensed realtor? Tell us your thoughts below.