Text by Jim Hiebert
Buy a private listing? Use an agent? Why should you use someone who seems to make a lot of money for nothing. Will Com Free really save you a lot of money? Here is a perspective from someone who has been an agent for a few years and has bought and sold over thirty properties in the last number of years.
There are many things to consider when you want to buy or sell real estate. You are dealing with large sums of money and want to make an excellent decision. Excellence demands input from someone knowledgeable. Some people rely heavily on their lawyer to make sure that they are making a correct legal decision. That is wise, and a move that I heartily encourage. You also need someone who knows what market values are and that happens to be the real estate agent. A good agent can tell you within a few thousand dollars how much a place should sell for. So how do you choose?
Trust. That is the one ingredient in looking for an agent. You should never, never use an agent whom you do not trust. Just because agent X has a place listed, does not mean that you should buy through him/her. You should choose an agent who has earned other people’s trust through his/her honest dealings with others. Ask your friends for a referral for someone they have dealt with and with whom they have been happy.
Hot market – who needs an agent? I can sell it myself and save myself a lot of money. Ever hear that? That is someone who has not experienced the power that demand has. When more than one person wants your property, you as an individual must choose which one to sell to. But when an agent deals with it, they can set up a bidding war, often netting you many thousands more that an agent can cost you.
Insurance. What kind of insurance can you buy to prevent someone suing you in the event that a crack in the foundation is discovered that might have the appearance of being covered up. With an agent you have the protection of their insurance in the event something goes wrong, or something is forgotten in the declaration of items in your home.
Spotting a good agent – Conflict of interest is the first big consideration for you in picking an agent if you can’t find a referral. If an agent has an interest in a development of their own, and wants to list your place, you are vulnerable to additional showings to help that agent sell more of their products. It’s a little like setting the fox to guard the hen house. You are helping to put temptation in their path that should not be there. Look at the RCMP – do they allow their people to work in the same area that they grew up in? Rarely – they are wise enough to know that temptation to let a friend get off would compromise their good name. When I was selling real estate, I talked to a fellow agent about jointly buying their wonderful property with lots of potential for development. He gave me a very wise answer – Jim, I sell real estate, I don’t buy it. Wisdom.
Working smart. How can you get an agent to work hard for you? Insist on them using the MLS system (Multiple Listing Service). It’s the numbers that create demand and that give exposure, giving you the best price if you are selling and the most options if you are buying. MLS also ensures that the other companies are aware of your product. If an agent unwittingly or purposely lists your property too low, there will be a huge demand because everyone loves a bargain. There are agents who have friends looking for just your kind of property, especially if it comes in thousands below market value. To avoid those pitfalls, back to TRUST.
Commission. We all want the lowest commission possible to save money when we buy or sell. But look at what motivates other agents to show your place – I’ll help you with the hard ones – it’s money. When you list, you need to ask the question – how much do you get, and how much does the selling agent get? Some unscrupulous agents have begun the practice of tilting the table their way so that more than half comes to them when they list a home. The opposite should be true – you want as much of the pie as possible going to the selling agent – they have the buyer. A technique that we have used to draw more attention to a property is to list at say 7 percent, and ask that 4 percent be paid to the agent who brings the buyer. When the agents look at what is available for their buyers, whose place do you think they’ll show first, the one where they earn 2 or 2 ½ percent or yours at 3 ½ or 4 percent? You pay no more, you just split it differently, and to your advantage – you are paying the bill after all.
These are a few of the techniques that have helped us. We can’t stress enough 1) to use your agent, not the one who has the property listed and 2) to choose an agent whom you trust. Period. Happy hunting!