Hiring a Real Estate Agent: An Upfront and Honest Q&A

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The boom times are over. But homeowners have learned a lot and are rightfully wanting more from their real estate agents. Here\'s an honest, straight-up look at the reasons to work with an agent (or not!).

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Hiring a Real Estate Agent: An Upfront and Honest Q&A

  1. 1. Hiring a Real Estate Agent:An Upfront and Honest Q&A (A.K.A. “WHAT’S THE DEAL WITH FIVE-FIGURE COMMISSIONS?”) karriflatla.com
  2. 2. “Fundamentally, our homes—our personalreal estate—represent a sacred opportunity tobe safe and comfortable in a world thatdoesn’t always feel so. To help the homeownerbe successful with this is an honor.” Karri Flatla
  3. 3. Question: What am I *REALLY* paying for? Answer: Buying or selling a home can be a stressful experience at the best of times. So when you hire a real estate agent to represent you, you want to know that your money is well spent, whether you’re paying the commission as a seller or negotiating for the best price possible as a buyer. Let’s take a closer look at what those 4- and 5- figure commissions are paying for …karriflatla.com
  4. 4. Earning Our Keep: 5 Value Promises Agent Value Promise 1: Strategic Action Home ownership is a massive financial commitment and an even bigger emotional one. Transaction management: right actions at right time. Objectivity and calm through tough negotiations. Avoid costly missteps and maximize positive results.  Equity position, liability, comfort, lifestyle, security  Difficult to measure. Easy to appreciate.karriflatla.com
  5. 5. Earning Our Keep: 5 Value Promises Agent Value Promise 2: Taking care of Business Real estate agents are independent contractors and pay for the lion’s share of costs associated with representing clients. Real estate board fees, provincial council fees, and brokerage fees Marketing sellers’ homes (online/offline/digital/print/other) Time spent helping buyers find the right home General business expenses (insurance/rent/office) When (and IF) a deal closes, commissions are shared between the buyer agent and the seller agent.karriflatla.com
  6. 6. Earning Our Keep: 5 Value Promises Agent Value Promise 3: Financial Risk In Lethbridge, AB, more than 50% of MLS® System listings do not sell. When a real estate agent markets your listing, she is shouldering an upfront risk because your house may not sell and in turn, the agent will not see a commission.karriflatla.com
  7. 7. Earning Our Keep: 5 Value Promises Agent Value Promise 4: Avoid Liability Humans make mistakes. But due diligence minimizes them. When something goes wrong, the affected party may take legal action. In Alberta, real estate agents must carry Errors and Omissions insurance for this purpose. A professional who is held to a high standard of care bears personal and professional risk that is tough to put a price on.karriflatla.com
  8. 8. Earning Our Keep: 5 Value Promises Agent ValuePromiseMyth 5: MLS® System Access Is the the MLS® System THE reason why people hire real estate agents? Hopefully, no! Good agents do more than load clients up with market data they’ve copied and pasted from a database. Good agents provide meaningful analysis of market information to support effective decision making. Good agents strive to enhance and protect their clients’ best interests.karriflatla.com
  9. 9. Did You Know? Real estate agents, by way of association fees, pay for the maintenance and development of the Multiple Listing Service®. Despite this, many believe MLS® System data should be “opened up” to the public. While this may seem fair in theory, such disclosure of sensitive transaction data would be tenuous in practice. If specifics like selling price and other client info were publicly available, it would be difficult to protect clients from the misuse of their confidential information.karriflatla.com
  10. 10. Question: Can’t I just sell my house without an agent? Answer: The decision to go it alone comes down to 3 things: (1) time (2) desire (3) money  Ask: Am I willing and able to take on tasks like marketing, pricing, contract negotiations, and more?  Ask: Do I have the patience, objectivity and focus to create the very best result for me and my family? If you answered YES to both questions … you may be ready to manage and negotiate your own real estate transaction. Good to know: In a soft market, many private sellers still pay commission to a real estate agent who “brings them a buyer.”karriflatla.com
  11. 11. Question: Can I access and post my own listing to theMLS® System? No, but some brokerages offer “mere posting” services whereby the homeowner pays an agent to post the listing on their behalf. What you need to know: o The seller forgoes full agency representationbut avoids paying full commission. o The agent ensures accuracy of information, but he does not act on behalf of the client or provide confidential advice. o The scope of services provided to the client generally stops there. Check with RECA.ca for more information on mere postings.karriflatla.com
  12. 12. Question: How can I be sure my home is listed for theright price? Answer: Your real estate agent will do a Comparative Market Analysis (CMA) to assist with pricing. Factors to consider when setting a list price: o Active listings your home is competing with o Recent sale prices of homes comparable to yours o How quickly do you want/need to sell? (motivation) o Days on market versus final selling price of comparables o Your financial/emotional comfort with the *market* price TIP: Resist the urge to “start high” and risk your listing going stale.karriflatla.com
  13. 13. Question: How do I choose the right REALTOR®? Answer: Choose someone who puts you at ease and demonstrates professional competence. Ask yourself: Do I feel natural and at ease with this person?  Am I willing to share very personal information with him/her?  Did the agent talk mostly about him/herself? Or did s/he get to know us?  What is the agent’s professional background, experience and reputation?  Is s/he forthcoming about his/her methods and strategic approach?  Is s/he easy to understand and converse with? Or does s/he talk “above” us?  What is the agent’s knowledge level and does s/he share ideas willingly? Trust your instincts. And if you’re unsure, interview another agent!karriflatla.com
  14. 14. Bottom Line:Buying or selling a home IS a big deal. CHOOSE WISELY. CHOOSE WITH YOUR HEAD. CHOOSE WITH YOUR HEART. karriflatla.com

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