Hiring a professional real estate agent is a smart move for both buyers and sellers, helping to navigate complex transactions and avoid costly mistakes. However, finding the right agent is key. Here’s a guide to choosing a real estate agent that aligns with your specific needs.
Real Estate Agent Basics
Real estate agents are licensed professionals who facilitate home buying and selling. They provide crucial market insights, guide clients through each step of the process, and offer referrals to other necessary professionals (e.g., home stagers, attorneys). Most agents can represent either side of a transaction:
- Buyer’s Agent: Helps buyers find suitable listed homes, craft competitive offers, and negotiate with sellers.
- Listing Agent (Seller’s Agent): Assists sellers in pricing, listing, and marketing their homes, and negotiating with buyers.
While an agent can represent both sides in a single transaction (dual agency), it’s generally advisable to have an agent solely dedicated to your interests.
Realtor vs. Real Estate Agent vs. Broker
- Real Estate Agent: Licensed by the state to assist in real estate transactions, adhering to national and state laws.
- Realtor: A licensed real estate agent who is also a member of the National Association of Realtors (NAR). NAR members pledge to abide by the association’s stringent standards and code of ethics.
- Real Estate Broker: Possesses additional training and a broker’s license, going beyond the requirements for an agent. A broker can oversee other agents, work under a managing broker, or operate independently.
How to Find and Interview Real Estate Agents
- Seek Referrals: Start by asking friends, family, and colleagues for recommendations.
- Online Research: Look up prospective agents’ websites and online profiles (e.g., Zillow’s Agent Directory). Read their specialties, experience, and customer reviews. Pay attention to how they respond to any negative feedback.
- Interview Multiple Agents: Don’t feel pressured to choose the first agent you meet. Interview at least three agents, treating it like a job interview. Ask each agent the same questions to compare their responses effectively.
- Referral Services: You can also get matched with agents through a lender’s network or a standalone referral service. Before using these, understand their agent requirements, how matching works, and what recourse you have if the match isn’t suitable.
What Buyers and Sellers Should Ask Real Estate Agents
These are crucial questions for anyone looking to hire an agent:
General Questions for All Clients:
- Is the agent licensed? Verify their license status on your state’s real estate commission website.
- Will the agent represent my interests? Clarify if they will exclusively represent you. Be wary of “dual agents” (representing both buyer and seller) or “transactional agents” (no fiduciary duty to either side). Request a written disclosure of the relationship.
- What experience and training does the agent have? Ask about their years of experience, types of clients served, and any specialized training or designations (e.g., for seniors, military members, luxury homes).
- Will the agent or assistants work with me? If they work as part of a team, understand who your primary contact will be and how much direct access you’ll have to the main agent.
- How will the agent communicate with you? Discuss your preferred communication method (text, phone, email) and frequency to ensure alignment.
- How much will the agent be paid?
- Historically, commission (typically 5% to 6% of the sales price, split between buyer’s and seller’s agents) was paid by the seller.
- Starting August 17, 2024, a significant legal settlement with the NAR changes how buyer’s agents are paid. Buyers can now negotiate who pays and how (e.g., flat fee, hourly rate, or a percentage). New norms are still being established. Ensure you fully understand the new payment structure and discuss it explicitly.
- Were recent clients satisfied? Request references from clients they’ve worked with in the past year. Ask about their satisfaction, smooth aspects of the process, challenges encountered, and how the agent handled them.
Specific Questions for Buyers:
- What challenges will I face as a buyer in today’s market? A good agent will set realistic expectations regarding housing availability and competition.
- How will you help me find listed homes in my price range? Ask for examples of how they’ve helped similar buyers recently.
- How will you help me make competitive offers and negotiate with sellers? Look for an agent who will help you stay within your budget and goals while being effective.
- What’s covered in our buyer representation agreement? Discuss and negotiate terms like duration (usually 30 to 90 days), fees, and the geographic search area. Read it carefully and don’t hesitate to ask questions or consult a lawyer.
Specific Questions for Sellers:
- What are the comparable listings in my area? The agent should provide a comparative market analysis (CMA) of similar homes sold in the past six months.
- What do you think my home is worth and why? An agent recommending the highest price isn’t always the best. Choose one who justifies their recommendation with solid market knowledge.
- What should I do to improve my home? Listen for well-reasoned advice on necessary fixes and their potential return on investment.
- How will you market my home? Beyond listing on the MLS and major real estate websites, inquire about other promotional tools like professional photos, video tours, 3D tours, and advertising strategies. The level of marketing depends on market conditions (e.g., less marketing needed in a seller’s market).
How to Choose a Real Estate Agent
While experience and professional approach are vital, a strong personal connection is equally important. Shop around for a competent agent who genuinely listens to your needs, responds effectively, and has a working style that clicks with yours. You are not obligated to sign with the first agent you meet. In real estate, people skills and rapport are as crucial as expertise.