Why You Need A Real Estate Agent

Five Reasons Why You Still Need A Real Estate Agent

The proliferation of services that help
homebuyers and sellers complete their
own real estate transactions is relatively
recent, and it may have you wondering
whether using a real estate agent is becoming
a relic of a bygone era. While doing the work
yourself can save you the significant commission
rates many real estate agents command, for many,
flying solo may not be the way to go–and could
end up being more costly than a realtor’s
commission in the long run. Buying or selling a
home is a major financial (and emotional)
undertaking. Find out why you shouldn’t discard
the notion of hiring an agent just yet.

1. Better Access/More Convenience

A real estate agent’s full-time job is to act as a
liaison between buyers and sellers. This means
that he or she will have easy access to all other
properties listed by other agents. Both the buyer’s
and seller’s agent work full time as real estate agents
and they know what needs to be done to get a deal
together. For example, if you are looking to buy a home,
a real estate agent will track down homes that meet your
criteria, get in touch with sellers’ agents and make
appointments for you to view the homes. If you are
buying on your own, you will have to play this telephone
tag yourself. This may be especially difficult if you’re shopping
for homes that are for sale by owner.

Similarly, if you are looking to sell your home yourself,
you will have to solicit calls from interested parties,
answer questions and make appointments. Keep in mind
that potential buyers are likely to move on if you tend to
be busy or don’t respond quickly enough. Alternatively,
you may find yourself making an appointment and rushing home,
only to find that no one shows up.

2. Negotiating Is Tricky Business

Many people don’t like the idea of doing a real
estate deal through an agent and feel that direct
negotiation between buyers and sellers is more transparent
and allows the parties to better look after their own best
interests. This is probably true–assuming that both the
buyer and seller in a given transaction are reasonable
people who are able to get along. Unfortunately, this isn’t
always an easy relationship.

What if you, as a buyer, like a home but despise its
wood-paneled walls, shag carpet and lurid orange kitchen?
If you are working with an agent, you can express your
contempt for the current owner’s decorating skills and rant
about how much it’ll cost you to upgrade the home without
insulting the owner. For all you know, the owner’s late mother
may have lovingly chosen the décor. Your real estate agent can
convey your concerns to the sellers’ agent. Acting as a messenger,
the agent may be in a better position to negotiate a discount without
ruffling the homeowner’s feathers.

A real estate agent can also play the “bad guy” in a transaction,
preventing
the bad blood between a buyer and seller that can kill a deal.
Keep in mind
that a seller can reject a potential buyer’s offer for any reason–
including just because they hate his or her guts. An agent can
help by speaking for you in tough transactions and smoothing
things over to keep them from getting too personal. This can
put you in a better position to get the house you want. The
same is true for the seller, who can benefit from a hard-nosed
real estate agent who will represent their interests without
turning off potential buyers who want to niggle about the price.

3. Contracts Can Be Hard To Handle

If you decide to buy or sell a home, the offer to purchase
contract is there to protect you and ensure that you are
able to back out of the deal if certain conditions aren’t
met. For example, if you plan to buy a home with a
mortgage but you fail to make financing one of the
conditions of the sale–and you aren’t approved for the
mortgage–you can lose your deposit on the home and
could even be sued by the seller for failing to fulfill
your end of the contract.

An experienced real estate agent deals with the same
contracts and conditions on a regular basis, and is
familiar with which conditions should be used, when
they can
safely be removed and how to use the contract to protect
you, whether you’re buying or selling your home.

4. Real Estate Agents Can’t Lie

Well, OK, actually they can. But because they are licensed
professionals there are more repercussions if they do than
for a private buyer or seller. If you are working with a licensed
real estate agent under an agency agreement,
(i.e., a conventional, full-service commission
agreement in which the agent agrees to represent you),
your agent will be bound by common
law (in most states) to a fiduciary relationship. In other
words, the agent is bound by license
law to act in their clients’ best interest (not his or her own).

In addition, most realtors rely on referrals and repeat
business to build the kind of clientèle base
they’ll need to survive in the business. This means that
doing what’s best for their clients should be as important to
them as any individual sale.

Finally, if you do find that your agent has gotten away with
lying to you, you will have more avenues for recourse, such
as through your agent’s broker, professional association
(such as the National Association Of Realtors) or possibly
even in court if you can prove that your agent has failed to
uphold his fiduciary duties.

When a buyer and seller work together directly, they can
(and should) seek legal counsel, but because each is expected
to act in his or her best interest, there isn’t much you can do if
you find out later that you’ve been duped about multiple offers or
the home’s condition. And having a lawyer on retainer any time
you want to talk about potentially buying or selling a house could
cost far more than an agent’s commissions by the time the
transaction is complete.

5. Not Everyone Can Save Money

Many people eschew using a real estate agent to save money,
but keep in mind that it is unlikely that both the buyer and seller
will reap the benefits of not having to pay commissions. For example,
if you are selling your home on your own, you will price it based on
the sale prices of other comparable properties in your area. Many of
these properties will be sold with the help of an agent. This means that
the seller gets the keep the percentage of the home’s sale price that
might otherwise be paid to the real estate agent.

However, buyers who are looking to purchase a home sold by owners
may also believe they can save some money on the home by not having
an agent involved. They might even expect it and make an offer
accordingly. However, unless buyer and seller agree to split the savings,
they can’t both save the commission.

The Bottom Line

While there are certainly people who are qualified to sell their own
homes, taking a quick look at the long list of frequently asked questions
on most “for sale by owner” websites suggests the process isn’t as simple
as many people assume. And when you get into a difficult situation,
it can really pay to have a professional on your side.

Source Forbes