How to choose a real estate agent
The decision to buy or sell a home is one of the most important financial decisions most people make, yet many give little thought to finding the real estate agent best suited to their needs.
Agents are often chosen solely on the recommendation of a friend or an ad in the newspaper. But choosing the right agent can save you time, effort and aggravation in finding the perfect home at a price you can afford or selling your home quickly for top dollar.
"Real estate has always been a mark of independence and freedom in this country," says Donald R. Brenner, professor emeritus at American University. "Owning property is very important, and when you deal with someone who is going to help you buy or sell a piece of property, you'd better find someone that knows what they're doing.
"If you pick up the phone book and choose from the yellow pages, you won't make a better decision than if you picked up the telephone book to choose a brain surgeon," says Brenner.
Shelley O'Hara, author of 'The Complete Idiot's Guide to Buying & Selling a Home,' says, "When you announce your desire to purchase a house, you may be surprised at the number of real estate people who want to represent you. Agents come out of the woodwork. You won't have to worry too much about finding an agent -- you do need to worry about finding a good one."
Paul Purcell, a partner in Braddock & Purcell, a real estate advocate in New York City, agrees. "Buying a house is the most important financial transaction most people will make in a lifetime," he says.
"The most important thing when either buying or selling a home is to select the right real estate agent, but people usually go about it backwards. They read a newspaper or get one of the home magazines in the supermarkets, and they call about a home they see advertised. They should first select the real estate agent -- one who will understand what they need and can navigate the system for them.
"Advertising is designed to make the brokers' and agents' phones ring. Typically no one buys the house they called for, but from that point on, they're joined at the hip with a real estate agent they don't know anything about -- whether they are good, bad or indifferent or new to the business. They need to find an agent before they find house."
Brenner explains, "You must make inquiries before you sign with an agent or broker. Commissions are usually substantial, so some real estate agents will try to sell you anything. They'll tell you every house is the best house they've ever seen, every room is the prettiest, your kids are going to love it, and your dog is going to bark nicely. They'll tell you anything!
"If you're selling, your property may be the most valuable thing you own and it is of utmost importance to find an agent you can trust," Brenner says. "A real estate agent has a high fiduciary duty -- a duty of trust and confidence. It is the most important duty of any sales person or broker in real estate. An agent must disclose all the material facts of any transaction -- everything they know about the property, good or bad. If a salesperson knows there are three inches of water in the basement every time it rains, he is obligated to disclose that fact."
Ask friends for referrals. Friends can give you a starting point, but don't hire an agent solely on a friend's recommendation, says Brenner. Don't choose an agent based on personality alone, but make sure you can get along well. Choose the broker or real estate agency first, then ask the agency to recommend a couple of their best agents. Then stick with her. If you see a house for sale and call the agent listed on the sign, that agent's first concern will be representing the seller, not you, the buyer. "Sometimes the broker is associated with a franchise, such as Century 21," says author O'Hara. "If you select a franchised broker, you have the advantage of national name recognition and usually a strong national advertising campaign." But beware. "You aren't guaranteed a great agent just because you selected a well-known real estate franchise. You should select a firm based on that office's reputation -- not the reputation of the national firm."
Consider choosing an agent who is a Realtor. In addition to being licensed by the state to sell real estate, Realtors belong to the National Association of Realtors and must abide by a strict Code of Ethics. Brenner says, "The National Association of Realtors has a code of ethics that will knock your socks off, and they are very strict in dealing with people who don't abide by them." Also, only Realtors have access to Multiple Listing Services (MLS) through which members share listings and have access to many more properties than non-members. You can locate a Realtor in your area at www.realtor.com.
Avoid "dual agencies." These are agencies that represent both the buyer and the seller. "This is not a good idea," Brenner says. "The same person cannot equally represent both the buyer and the seller. "
Choose an agent that handles homes in your price range. Some agents specialize in high-end properties and won't give their best effort on properties under a set value. If they usually deal in fixer-uppers, they won't have the experience to navigate "Millionaire's Row".
Choose an agent who listens to your needs and takes the time to explain things you might not understand. Real estate transactions can be complicated and the terminology confusing. You need an agent who will both know the answers to your questions and takes the time to explain them. "It's extremely important to find an agent whose personality you like," explains Purcell, whose firm helps people find professional, trustworthy agents. "You want them to be bright, professional, trained, and someone who works in the business full-time, but personality is important. You're going to spend a lot of time with this person whether you are buying or selling. If you hate the agent and the agent hates you, you may be too far along in the process to correct it."
Choose an agent who works on your time schedule. If you can only look at homes on Sundays and your agent doesn't work that day, look elsewhere. If a listing agent doesn't work on weekends, consider who will be responsible for showing the house on weekends or holding open house. When buying a house, adds O'Hara, "Your agent will set up appointments for you to tour different homes and will accompany you on the tour. You should ask your agent a lot of questions; after all, she is the expert. Ask her opinion of the home."
Choose an agent who can and will provide other services. Will they help arrange a house inspection, refer you to qualified lending professionals and real estate attorneys, and conduct a study of the property's value?