I am continually amazed by how little some people know about the real estate business.
Most people generally have a good idea about how the industry works but every now and then I run into someone who is pretty naïve about the home buying process. Even doctors, lawyers, CEO’s and other professionals may not know how our business works.
Here are 10 things you should know about working with a Realtor®.
1) Realtors® work on commission
There may be a few exceptions here and there but most Realtors work on 100% commission. That means no salary, no draw, no bonuses, no nothing. If there is not a successful closing the Realtor does not get paid. No only do they not make any money they actually lose money. Agents are essentially small businesses with various expenses like advertising, websites, business cards, stationary, direct mailers, gas, time and energy. If they don’t generate revenue they lose money.
Realtors are not public servants. Don’t ask them to work for you if you don’t think they will get compensated with a commission from a successful transaction.
2) Hire a Realtor®
First figure out if you want to work with or without a Realtor. Some people want to work directly with the listing agent because they think that they will get a better deal on the property. If you do want to work directly with the listing agent keep in mind that they had a prior relationship with the seller before meeting you. The Realtor might look out for the seller’s interests instead of yours. It might be best to hire a Realtor that represents you in the transaction.
Real estate transactions don’t have to be adversarial but occasionally it comes to that. If you were in trial would you hire the same attorney that represents your opponent? No, you can’t and wouldn’t. Sometimes you need a professional looking out for you. Interview some agents and find the one that works best for you.
3) Be respectful of a Realtors®’ time
Be respectful and courteous. Don’t expect an agent to drop what they are doing to run out and show you a home. Despite what some may think we don’t just sit around twiddling our thumbs (well, some do). Remember, we are not on a salary so it is crucial for a Realtor to be efficient with their time.
4) Communicate with your Realtor®
If you have hired an agent hopefully you hired one that you can communicate with effectively. A good Realtor listens to their client and their needs. However, it is also our job to manage your expectations. Almost all sellers think their homes are worth more than they really are and buyers generally always want more than they can afford. Not always but quite often.
I often get calls from prospective buyers looking for a newer condo on the beach with fabulous views. The problem is that they want to spend much less than what is necessary to get that property. This is where good communication is necessary. Some Realtors are afraid to let you down and will try to find the impossible. This is just a waste of you and your Realtors time.
Let your agent know how you want them to communicate with you and how often. Do you want phone calls, e-mails, text messages, or all of the above? Also, it is good to set a realistic time frame for finding a home. I doubt either of you want to be looking for the next few years.
5) If you are working with a Realtor® don’t call the listing agent
Listing agents represent the seller, not the buyer. If you hire the listing agent then the agent will be working under dual agency. This means the listing Realtor represents both the buyer and the seller. A dual agent must not disclose confidential information to either party and must operate in a hands-off manner. A dual agent cannot get the highest price for the seller and the lowest price for the buyer — it is impossible.
Listing agents do not want to do the buyer’s agent job. I have done that before and it is a bit annoying but I did it for the sake of the transaction. Let your buyer’s agent do their job. If you need information about or want to see a property call your Realtor, not the listing agent. If your Realtor is too lazy fire them and get someone hungry.
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