Selling your home is an exciting experience, but it can be a bit overwhelming too. If you take time to organize your thoughts and find a good real estate agent to work with you, this can become the opportunity of a lifetime.
What is in a commisson?
Is the agents commission negotiable?
Just a couple of years ago, the real estate market was booming and supporting a large pool of real estate agents. Today, however, properties sit on the market longer and more owners are being foreclosed on. Many people either can’t afford to buy (or are afraid to buy), resulting in many agents who are struggling to stay in business. A wide array of issues will affect an agent’s motivation to negotiate their commission.
Think from the agent’s perspective when asking for a commission decrease. The bottom line for most agents is: it depends. What kind of property is it, and how complicated is the deal expected to be? A seller should consider that a property in a difficult location or unkept will require more effort from an agent. Most potential buyers will have higher concerns than with a property without these issues, and the agent can expect to be burdened with those concerns every time it is shown. A buyer should know the property he or she is considering purchasing. Knowing how long it’s been on the market is smart; no seller’s agent likes being known for properties that sit unsold for too long.
The ideal scenario for a commission negotiation occurs when a buyer’s agent and a seller’s agent are the same. When you sign with an agent as a buyer, evaluate the properties listed with that agent. An agent will usually happily negotiate since they can expect to make full commission rather than having to split it with another agent.
How does and agent earn their commission? When do I pay them?
Lets face it: no one likes to pay commission. It is important to realize, however, that a real estate agent can sometimes obtain a higher selling price than an owner can. Apart from this financial benefit, an agent can also make your selling process easier and ease your mind during the sale–but it doesn’t come free.
When signing the initial listing, a percentage or amount of money will be agreed upon for the commission. That varies from state to state, but most commissions are around five percent. If the home or property never sells, the realtor will get no money at all and if it does sell the realtor will get their commission at closing.
When the property is ready to close you will go to the title company and sign papers. As the seller, it won’t take very long to do this. This is usually the time to give the realtor the keys so they can give them to the new owner. The title company will explain how all the proceeds from the sell were dispersed and then give you your check. At this time, it is possible to see the exact amount the commission will be. The realtor will receive the commission after the deal is completed and the home has recorded at the county offices. Most people are pleased with the results and feel the commission was money well spent.
Why use the MLS?
MLS (Multiple Listing Service) is a powerful tool that is used in the real estate market. The MLS contains every home that is for sale that is listed by a real estate agent.
Being listed in the MLS instantly puts a home’s comprehensive information in front of real estate professionals. It contains specifics of a home, including the home’s address, age, square footage, number of bedrooms, number of bathrooms, heating and cooling means, whether it has a garage, pool, or spa, and other pertinent information. It will also usually contain at least one photograph of the home.
Using MLS helps narrow the field when looking for exactly what type of home you want. If you search the MLS as a first step, next you can take what you have found and actually go physically check it out. It can drastically cut back on the time and frustration involved in finding the perfect house that you looking for.
What are the agents duties?
A real estate agent has a specific responsibility to his or her client that is called a fiduciary duty, which simply means that the agent has to act in the best interests of his/her client. Not only does a real estate agent have to sell your house, he or she also has to be responsible for it.
A real estate agent’s fiduciary duties include being loyal – doing everything possible to gain an advantage; being obedient – promptly obeying all lawful instructions from the seller or buyer that conform to the purpose of the agency relationship; practice disclosure – reveal any material defects in the property, but not information such as poor school systems, dropping property values or traffic problems; exercise confidentiality – use discretion when revealing or concealing financial details; use reasonable care and diligence – prepare him or herself through education to competently represent the seller; and being accountable – for any documents or money entrusted to him or her.
A good agent will keep up with market activity and help his or her clients with contracts, inspections, negotiations, and the closing process.
Why advertise? Won't my house sell?
If you’re looking to sell your home, it can be done with the help of things such as a realtor, signs in front of your home, through the newspaper, online and many other ways. Regardless of how you sell your home, there are a few benefits that advertising can provide in the process.
Increase the awareness for buyers: It’s important for all buyers to know that your home is an option for them. By advertising your home while it’s for sale, you are increasing the awareness and making it clear it’s for sale.
Maximize your exposure: When you consider marketing your home through things such as the newspaper, online or through a realtor, you’re increasing your chances of having someone see it. The more ways you advertise it, the more exposure you’re creating.
Increase your chances of selling: If you don’t market your home, there’s a good chance no one will know it’s for sale unless they drive by and see a for sale sign. By effectively advertising your home, you can reduce the time needed for it to sell and move on faster.
As you can see, there are some great benefits to advertising your home when it’s for sale. Though your home may sell without it, you can greatly improve your chances of selling it quickly and easily—just advertise!
What about open houses?
If you’d like to sell your home, there are several different strategies you can consider. Whether you want to sell privately, with a realtor, put your listing in the newspaper or even consider having an open house, there are many different strategies you can use to get your home off your hands.
If you’re thinking about having an open house while selling your home, here are some great benefits to consider:
When you have an open house, you may increase your odds of selling a home. When your home is open to the public to view, you can get several different viewers coming from all areas and from many different real estate agents. Another benefit to having an open house is the fact that you’re allowing people to come in a way that benefits their schedule.
While there are benefits of having an open house, you should be aware that some visitors are not serious buyers and may not have an real interest in buying the house (e.g. interior designers looking for ideas). Try your best to decipher who is serious and who is just casual–without seeming nosy or rude. Another problem with having an open house is when people make a mess in your home. Whether they come in with their muddy shoes or they spill something when viewing, it can leave you with a mess to clean up when they leave.
Like anything, there are advantages and disadvantages to every situation. Be sure to consider the thoughts above to help you make your decision.
Why should I let the agent walk them through the home?
If you’re going to be putting your home up for sale, it’s important to plan it all out ahead of time. Know who’s going to sell it for you, make sure your house is prepared to sell and always make sure your home is clean and picked up nicely when people are coming to look at it.
When potential buyers come to look at your house, it isn’t uncommon for them to expect an empty house. When showing a house, a realtor always suggests you’re not there and that they do the walk through. Why is that? It makes them uncomfortable: When a potential buy comes to look at your home, they want to take their time and be able to tell the realtor why they like it and why they don’t. Your home may have sentimental value to you and you may be offended on why they tell you they don’t like certain things. A realtor on the other hand, has no attachment and can help them by knowing what they like and don’t for the other houses they show. It allows you to judge the buyer: If for some reason you don’t like the vibe you get from the potential buyers, it may allow you to judge and create a conflict. Realtors are the pros: realtors show and sell houses for a living. They are the pros and should be the ones doing the walk through. So, if you’re about to have an open house, you just may want to opt out on walking people through your home.