In finding the real estate agent that’s right for you, I continue to be surprised by how many people believe that all real estate agents are pretty much the same. Agents often are seen more as typical salespeople, rather than as professional service providers. Agents can vary quite a bit from one another in terms of their experience, training, evaluation skills, marketing expertise, negotiation strengths, hand-holding abilities, problem-solving wisdom, office systems, and checklists, etc.
Even in the current strong “seller’s market” it is not unusual for people to be less than satisfied with the quality or level of service they receive from the agent they first decide to work with. One out of every five homes listed for sale in the Palisades in this market has not sold!
Do Your Due Diligence
Nearly all agents will make big promises, so how can a homeowner or home seeker decide which potential agent will serve them best? Due diligence will pay off just as it does when careful consideration is given to other important decisions. If as much thought went into deciding who to use as a real estate agent as goes into deciding one’s attorney, accountant, or surgeon, people would likely be far more satisfied with the results of their decision.
Don’t Just Give Your Listing to a Friend
I have always highly recommended that one should treat the process exactly the same as would be done in an employment interview, and by looking past their sales pitch to their actual sales record and marketing system. Rather than just “giving the listing” to a friend, fellow club member, relative, or the agent who may have been involved in the previous transaction many years ago, seek to hire the best-qualified one for the job!
Ask Your Agent, “How Will You Sell My House?”
Before committing to a listing agreement, it might be useful to ask for a few seller references for similarly priced properties in the same general area. Find out if those sellers had a positive experience with that agent, and if they would use them again.
Ask what pre-marketing considerations and actions the agent commits to providing, and see if they know the absorption rate and its significance in your specific neighborhood and price range. Consider the probable benefits to you of working with an agent who has a full-time assistant or possibly a full team support system.
Do a Sales Performance Background Check
You might consider asking for some details about each agent’s actual performance. How many sales have they personally completed in the last year? What is their sales success ratio (the percentage of their own listings that they actually have sold)? What is their average sale price to list price ratio, and how does that compare with the average in that market area for the last year?
Zig Where Others Zag
It might be helpful for you to know what their marketing plan is and their commitment is in print advertising. Although more than 90% of the homes sold in our area now are first seen online before personal viewings are requested, many of the online looking is prompted by people noticing a photo or description of a home in a newspaper or magazine. Many agents do not provide such supplemental marketing and thus may not reach the attention of some of the most qualified or potentially best prospective buyers.
Of course, it is essential to at least take a look at the personal websites of any agents you are considering hiring. See if it is easy to use, clear in its presentation, and provides useful content and information both for buyers and sellers. Ask if they have any special online systems to attract quality buyers to their listings.
If You Buy and Sell At the Same Time
If you are thinking about buying a new home or an investment property, or both selling and buying a home at the same time, make sure the agent you are considering has sufficient expertise and ability to represent you effectively in both buying and selling. Many agents are highly skilled at selling properties but have not developed the same level of proficiency in representing buyers. Also, be sure to ask what strategies they can suggest if you will be selling and buying concurrently.
Find the Right Real Estate Agent For Your Home’s Needs
One final suggestion: be very cautious before deciding to work with the listing agent of a property you would like to purchase! Many buyers believe that there may be some advantage to them in working with the listing agent because they think it will help them succeed in making the purchase in case of multiple offers. This tendency typically becomes more apparent in markets that are short of inventory as compared with the numbers of buyers seeking homes there, and frustration with their failure to succeed leads them to try anything that might work.
One huge drawback they rarely consider is that the listing agent already has a fiduciary duty to get the highest price and best terms for the seller – and particularly in California, there are ethical considerations that pertain to those acting as dual agents.
Obviously there is a Great Deal of Money Involved
Sellers and buyers tend to be very concerned about the quality of service that they receive and rightfully so when considering the importance of a real estate transaction. There are also very substantial liability issues, time issues, risk issues, and emotional issues.
An agent wishing to be successful must realize that repeat business and referral business is the backbone of continued success. Although an agent can continuously attempt to cultivate new business from strangers, sooner or later they realize that true success in this business cannot be maintained in such a way. Referrals and repeat business are the only avenues to long-term success. This is simple when there is customer satisfaction and yet nearly impossible to accomplish unless the client has been pleased with the service and outcome, every step of the way.
The Best Agents Are Busy Because They Sell and The Many Hats They Wear
Imagine an agent who has been selling real estate for years and years with satisfied customers being his or her best source of advertising. “Word of mouth” as they say, goes a long distance among friends and colleagues. Now further imagine second generation and third generation referrals all stemming from an original referral from a satisfied customer.
As obvious as this may seem, there is still a misconception that a year in and year out top-ranking agent may be too busy to handle the detail. Before agreeing that this might be the case, consider that an agent cannot maintain success without impeccably handling the details and intricacies involved. Also, a successful agent stays successful because he or she is intuitively aware of the importance of good communication and attention to detail. Being proactive and handling issues before they might become problems is another element that keeps an agent successful.
Consistency year after year is the testimonial that assures you that the agent must be doing well for his or her clients. If there are still concerns, ask the agent for names, addresses, and phone numbers of past clients and speak with them directly just to be certain.
Chances are a successful agent has systems in place and is extraordinarily well organized, allowing him or her to be available to respond to the needs of the client. A top-notch agent will be personally available to you, leaving clerical and similar activities to other well-qualified staff members.
While those are certainly essential, the agent’s role is far more complex and requires a great variety of skill sets. Here are some of the many “hats” an agent “wears” when working with their client to buy or sell a home.
Client Services Hat
A top priority and critical element is to be prepared to provide a wide range of support services for clients, beyond the basic fulfillment of the fiduciary role an agent must honor and uphold to their best ability.
Marketing Hat
People need to know of the agent and his or her qualifications for being entrusted with perhaps the people’s greatest financial asset. Realtors who do higher-quality marketing of their listings and their brand, and do more of it, in general, are often more successful in the long run compared to agents who don’t,
Operations Hat
Real estate is actually a business that needs to be professionally run. It includes most of the functions involved in other businesses such as sufficient financing, necessary equipment, and office space, systems for the major activities, etc.
Property Preparation Hat
Whether offering just a few basic recommendations or providing home staging coordination, a home is always going to be sold with better terms and higher profits if it has first been professionally prepared.
Sales Hat
The agent must have an intimate knowledge of the neighborhood and history of sales and statistics of homes somewhat comparable to their listing. They will be at a significant disadvantage if they have not yet developed basic negotiation skills, mastered the art of helping to overcome challenges that may arise or the skills involved in demonstrating higher value.
Negotiating Hat
Once they have helped to generate a purchase offer, the agent will need to be able to help both sides come together in agreement. They may also need to anticipate aspects of the potential transaction that could lead to later friction and possible re-negotiations.
Hand-Holding and Problem-Solving Hat
Whether representing the seller or the buyer, a seasoned agent will have experienced a wide variety of surprises, challenges, problems, emotions, and personal issues, family disagreements, last-minute situations or emergencies, etc. His or her role will require the skills of a counselor or therapist.
Escrow Management Hat
Many years ago an escrow involved several pages of contract term and escrow details, with one or two loan options, usually a general home inspection, and a standard 30-day closing period. Transactions today are far more involved, including hundreds of pages of contract and escrow documents, a myriad of inspection reports, and repair estimates before removing contingencies.
Time Management Hat
There often just aren’t enough hours in the day for an agent to handle and complete all of the necessary activities to successfully wear all of the above hats. Many agents seem to wear most of these hats well, although it may require several years to become proficient in all of the roles involved. Professional coaches and training programs are available to assist agents in learning how to develop better skills and be able to wear more of the hats more effectively and consistently.
10 Questions to Ask Your Realtor
Remember that success does not occur by chance. Successful people become successful by taking care of people. They remain successful by providing good service and listening carefully to a client’s personal needs – then by delivering results.
We have 10 questions and guidelines on “How To Select A Real Estate Agent.” One question I would suggest not giving high importance is, “How much is my house worth?” Too often, an agent is selected because they give the highest estimate of value.
What is your experience and track record in real estate?
How many years in real estate and how many homes they have sold may indicate more wisdom from experience. Reviewing a list of their sales for the past two years will show if they specialize in your area and in what price range. Find out what percentage of their listings do not sell. Note if they share their average sale-to-list price ratio and how it compares to the market average. See if they offer you several names and phone numbers of references to call.
Where do you live, and where is your office?
The closer they are to your home, the better for you. An agent within 10 minutes will have much greater local knowledge and familiarity with every home that has been for sale than will an agent who is 20 minutes away. The closer agent can answer buyer or seller questions and network more effectively.
Do you have any specialized training or background for this work, or on-going educational activities?
Agents with college degrees may have better writing and verbal communication skills. Those who also have a Broker’s license may have more knowledge. Agents who regularly attend seminars, participate in networking groups and conference calls, subscribe to professional magazines, etc. might have more expertise to better serve you.
What preparations do you recommend before we put our home on the market?
See if the agent suggests any “staging” ideas that might indicate some expertise in that area. See if they advise pre-inspections which could show a higher degree of care and a willingness to provide extra services to minimize later hassles for you.
How would you propose marketing our home?
See how many extra color ads they offer, which publications they guarantee to use, and what type of special materials they would produce. Find out if they have a personal Internet website, what extra exposure they would provide on various other sites, and whether they offer virtual tours.
What pricing strategy would you recommend?
There is both a science and an art to pricing. Their answer may show their degree of skills in competitive positioning. Ascertain if they have a carefully considered method for assuring you that your home will sell in a timely way and at the highest price.
What staff or team support do you provide?
Most are still “stand-alone” agents, although many now have an assistant to handle numerous administrative functions. The highest level of service is provided by an agent with a team of specialists. There is always someone available to answer the phone, attend lengthy inspections, be on top of marketing and advertising details, coordinate scheduling of property showings, keep on top of escrow issues, and help assure that all disclosure requirements are met.
How available are you, and how flexible is your schedule?
Some agents generally prefer to work only five days a week. Others are willing to answer calls and pages seven days a week and will show their listings any day most convenient to the buyers.
How would you handle multiple offers?
Some agents have no experience or skills to deal with the complex and emotional issues that come up when more than one buyer is found at the same time. Seasoned veterans may have a special system to manage the process to a sellers’ best advantage.
Why should I list my home with you?
See if their answers show a professional commitment to service, a “good fit” for helping you accomplish your goal, a positive and enthusiastic attitude toward the work, and an appreciation and honest respect for your needs. Try to sense if there would be a good rapport with them and if you would feel compatible with their style and attitude.
Please call me if you would like the guidelines on “How To Select A Real Estate Agent.”