Are you thinking about listing your home For Sale By Owner (FSBO) or considering buying your next home unaccompanied by a real estate agent? Why use a realtor anyway?
Whether you’re buying or selling property, real estate transactions are a complicated process; there are a plethora of things to consider and loose ends to tie up in any transaction. Without a knowledgeable advisor, this process can quickly spiral into a full time job. Zoning and local real estate laws also need to be taken into consideration. This article will outline the benefits of using an experienced realtor and what to expect if you decide to jump in head-first and handle the job of selling or purchasing a home on your own.
Purpose of a Real Estate Agent
What is a realtor’s job? Do you think they just show houses? Think again! A realtor (or real estate agent; these terms are used interchangeably) is similar to an attorney’s representation for buyers and sellers in real estate transactions. Think of them as a fiduciary who has your best interests by law in any real estate contract. Some of their duties are outlined below:
- Realtors prepare and execute all real estate contracts and paperwork; supplying required contingencies, addendums and forms in accordance with real estate laws. They should have a firm understanding of real estate law, and provide you with a pamphlet on the law of real estate agency upon first working with you.
- For sellers, they’re tasked with getting the selling price correct the first time! For new and potential listings, realtors will perform a comparative market analysis (CMA) which uses the same methodologies of an appraiser to find similar properties that are active, pending or recently sold to provide you with an accurate price range to list your property at. A quality agent will meet with you and inspect your home first before making comparisons ensuring the most accurate price possible. They’ll also advise on preparations like staging, painting, de-personalization, and renovations to ensure the maximum sales price.
- A realtor will attend all aspects of a real estate transaction, keeping all parties in alignment with deadlines; think inspections, appraisal, title/escrow, showings, open houses, calls-of-interest, staging, photography, contracts, loan signing, and closing.
- Your realtor will keep open communication with all associated parties and hold them to deadlines, keeping transactions from falling through. Parties include attorneys, lenders, title reviewers, inspectors, appraisers, and opposite parties.
- Realtors resolve issues that could hold up or terminate transactions like holdovers, title issues, repair issues, zoning circumstances, permits, financing and more.
- Negotiation skills are often overlooked but extremely important in real estate transactions. Your realtor will help you finalize pricing objectively, submit terms in your favor and determine dates and timelines for a quick closing. They’ll also keep you honest when emotions could be clouding your judgement.
- Realtors tie up loose ends like signage, key boxes, key delivery and last minute removal items.
What does a realtor do for a seller?
Should you list your home For Sale By Owner (FSBO)? This is a viable option but does limit your overall market exposure. A realtor will get you a lot more showings through their networks, marketing methods, open houses, signage, flyers and by listing your home on the MLS. They’ll install a lockbox on your door so that other agents can tour your home with their clients. With a FSBO you’ll still end up paying buyer agent commissions in some cases. Per a National Association of Realtors study in 2017, a realtor will get you up to 30% more for your listing. This will be more than you’ll pay in commission (which is negotiable as well).
Aside from the functions stated above, realtors are also good emotional shields. Emotions can ruin FSBO deals; comments from potential buyers on design choices, price and other opinions make it difficult for sellers to stay objective sometimes. This is understandable because home is where your heart is; maybe you raised your family in this home or put blood sweat and tears into a remodeling or landscaping project. As much as we try to keep our emotions in check, real estate deals have a lot of passion involved. A good agent will be your intermediary, keeping showings and transactions running smoothly.
Real estate transactions fall through sometimes due to inspection issues, legalities, financial issues, or deadlines; professional realtors will help maneuver through these predicaments and have a Rolodex or digital contact list full of professionals ready to call in case you quickly need assistance to keep a deal above water. They can promptly provide you with reliable contractors, lawyers, loan officers, escrow agents, notary signing agents, inspectors and more.
Staging and photography should also be taken into consideration as a seller.
A skillful agent will assist in getting a home staged properly, advising on the removal of personal items and decorations that could deter a potential buyer, making them feel less welcome. Hiring a staging company is also a consideration. Your agent should make staging recommendations and give you some reliable contacts.
Professional photography is a must if you plan on attracting buyers quickly. Some realtors (like us) provide free professional photography or will be able to point you to a professional to provide beautiful edited photos for your listing.
Pricing is one of the most important pieces for sellers to get right from the get go! Getting the sales price incorrect will cause a listing to sit on the market for longer than it should and cause potential buyers to think there is an issue with the home resulting in fewer showings. Adept agents will perform the above stated CMA to make sure you get the price right from day one. When listing your home FSBO, you can run the risk of missing the price target and not selling in a timely manner. Again, sentiments can get in the way here causing you to list higher than you should. You can attempt to get an agent to help estimate your property and perform a CMA for a flat fee if you just need assistance on the price.
Once you’ve found a qualified buyer or multiple buyers, some negotiating will need to take place. Your realtor will review each offer in detail with you and help arbitrate the best terms for you as well as guide you through all the paperwork and signatures that are required for closing once you settle on an offer. These can be treacherous steps to navigate by yourself without extensive real estate knowledge or a fiduciary by your side.
It’s pretty easy to see why you should use a realtor to sell your home. It’s possible without one, but not for the faint of heart!
Do I need a realtor to buy a new home?
Let’s face it, sites like Zillow, Trulia and Redfin have changed the way we search for homes now a days. It’s fairly straightforward to input your search criteria and find the homes that match your needs. Do you need a realtor to buy a new home anymore? For the foreseeable future, we say yes in almost all cases! Buying a home is the largest financial decision you’ll make in a lifetime. Most buyers, even though they’ve found listings themselves opt to use a realtor to guide them through this complicated and sometimes turbulent endeavor.
Did you know that as a buyer, you don’t pay a commission to your agent? These 5% – 6% fees are typically paid by the seller, then split between the listing office and the buyers agents office. This means, as a buyer you get all the benefits of having your own personal fiduciary without spending the extra cash. There really is no reason not to use an agent when buying a home; it only benefits you. Check out some of the benefits below:
- A realtor will have your back in the negotiation stage, helping you obtain the best price for the home you’re pursuing. They’ll help you navigate all the complex forms, terminology, clauses, and submit all offers in your best interest. When submitting offers, they’ll make sure to build in contingencies to allow you to walk away from the contract with your earnest money if everything is not to your contentment.
- Having an agent will make it a whole lot easier to view listed homes, scheduling appointments for owner occupied properties and opening keyboxes for you during your search.
- A good realtor will provide neighborhood information (including information that the listing agent might not disclose) for you during your search. They should be able to quickly identify school districts, neighborhood crime rates, zoning restrictions, market data and more.
- Your realtor will also help navigate the home inspection; providing inspector contacts as needed and attending initial and follow up inspections. If repairs are needed, they can assist you in negotiating the completion of the work or credits to supplement the cost.
- Your agent will request and pull all the disclosures from the property and review them with you. This will alleviate confusion if you don’t know what to ask or aren’t sure what must be disclosed by law. Here in Washington State this is called the form 17 Seller Disclosure Statement.
- If you’re financing the purchase of a new home, your realtor can provide loan information, pre-approval/lender contacts as well as inform you of the current interest rates for conventional, ARM, and short term loans. When under contract, they should also attend your appraisal to make sure it is in alignment with the sale price. If there’s a delta between the appraisal and the purchase price, a good agent will work with you and your lender to figure out how best to proceed.
The bottom line is quality realtors are here to save you time and money. They serve your best interests by law and can save you a whole lot of headache in the long run. We hope you found this post informative and beneficial. If you’re a first time home buyer, check out our recent post on the subject, it will help you start to navigate the home buying process.
If you reside in the Seattle Washington area, check out some of our posts on current and historical housing statistics to help aid you in your real estate journeys. We provide market stats for different counties like median sales price, days on market, closed sales, inventory, price per square foot and more. We also have a market stats page for quick viewing.
Ready to Buy or Sell a Home in the Greater Seattle Area?
Team Sno-King brings over 15 years of real estate brokerage experience in the Seattle housing market. Our clients inspire and motivate us.
Why buy with us? Over the years, our team has built a reputation of securing high-end listings and finding the gems in the rough. Get notified when your Dream-home hits the market.
Why sell with us? Whether you’re considering a rental income opportunity, moving out of town, or going through hardship, we strive to get your home sold as fast as possible.
What we offer our buyers and sellers:
- Attorney level representation – preparation & execution of all contracts and paperwork; supplying required contingencies, addendums, forms in accordance with real estate laws.
- Free professional photography with photo editing for listings
- Free moving truck!
- Getting the price right through CMA/appraisal and correlation of market data and comparable differences.
- Advising on preparation/renovation of home to ensure maximum sales price.
- Attending to all aspects of the sale and keeping all parties in alignment with deadlines: inspections, appraisal, title/escrow, showings, open houses, staging, photography, contracts, closing.
- Communicating with associated parties: attorneys, lenders, title reviewers, inspectors, appraisers, opposite parties.
- Resolve issues that could hold up or terminate transactions: holdovers, title issues, repair issues, zoning, permits, financing etc.
- Tying up loose ends: signage, key box, key delivery, last minute removal items.
Thanks for reading! We’d love to hear your thoughts in the comments below!