Smart real estate buyers will take the time to interview prospective realtors before they hire them. Below are some important questions to ask your estate realtor before signing on the dotted line. Do you work part-time or full-time as a realtor?
Buying or selling a real estate is a very important event. Therefore the last thing you want is to end up working with someone who only dabbles part-time in real-estate. What you need is a person for whom real estate is a full-time occupation. When making such a big financial decision such as to sell or buy a real estate, you want to be sure that your realtor will have the time and commit to the service level you require to get the job done right. Have you ever sold a house in the area in which the one in question is located?
While general knowledge and experience in real estate are vital, familiarity with the specific area in which you wish to purchase the house is key. Not only should the realtor be able to share information with buyers regarding commuter routes, providers of goods and services, as well as other local knowledge. In addition, such a realtor will be able to know if there is a particular method to marketing real estate in that area than would a realtor from elsewhere. Will you handle this transaction personally or will you delegate to others?
Most realtor will delegate their services, so this should not necessarily be held up as a negative. However, you will want to know to what extent the realtor will work and be involved in the transaction. This question will also give you an idea of the knowledge of the realtor in the process: open houses, title, closing, signage/marketing/advertising, qualification of buyers, negotiation of price and terms, contract negotiation and real estate inspections. What is your educational background and experience in real estate?
A realtor with a minimum of four years experience is an indicator of dedication to the real estate profession, as well as adequate opportunity to get a good sense of the housing market. With regards to education, the law requires realtor to take classes as a way of maintaining their licenses in good standing. You should therefore seek arealtor with an education that surpasses their minimum requirements. An experienced and well educated realtor is worth hiring. What is the period of time in which you have been in business?
While freshly licensed realtor are just as good as the experienced ones, be sure to hire one with a good level of training as well as access to competent mentors. Don’t shy away from newer realtor as they typically have more time to fully concentrate on your needs. You want a realtor who will learn something new each year, rather than repeat their very first year over and over again for the last two decades. What is the average list-price-to-sales price ratio that you offer?
It’s important to know the average ratio of the realtor. You want a good realtor who is capable of negotiating a sales price lower than the list price on offer. A professional realtor will have a good track record in the negotiation of sales prices very close to the list prices. You therefore want a sellers’ agent with a higher ratio that is closer to 100% and a buyer’s agent with a ratio below 99%. What is your most effective marketing strategy or plan for my particular requirements?
If you are buying a real estate, you will need to know how the realtor will search for your new real estate; how many homes they will show you before you find the one you wish to buy; whether you will be competing with other buyers; how they will handle multiple offers and whether they will present the offers themselves. A good agent will typically offer marketing services in the form of online and offline advertising and marketing services. Ask about the frequency and manner of marketing, as well as any open houses. Can you provide me with past client references?
Every estate agent should have past client references ready to show you. Even the newer realtor will have references from their previous employers which can work just as well. Inquire whether any of the individuals provided as a reference are related to the realtor. Ask the agent to provide you with contact information as well such that you can call the reference to ask further questions. What sets you apart from your competitors?
Any estate agent worth their salt will be more than happy to answer this question and let you know why they are the best suited for your job. While the standards expected by real estate buyers vary from one to the next, most say they look for estate agents who are: assertive, trustworthy, honest, analytical, friendly, good communicators, excellent negotiators, accessible via phone or email, and able to keep a good sense of humor despite the trying situation. Will you allow me to review beforehand the documents that I will be required to sign?
An indicator of a professional realtor is one who avails forms to you for your perusal before asking you to sign them. Where possible, be upfront in requesting for these documents. When buying a real estate, you will need to request for copies of these documents: the Buyer’s Broker Agreement (whether exclusive/ non-exclusive); Purchase Agreement; Agency Disclosures; and Buyer Disclosures. Be sure to read all these documents and ask questions on any areas in which you don’t understand. Just like any legal document, it is strongly advisable that you have an attorney take a look at it before signing. How will you assist me in finding other professionals?
Ask the real real estate agent to explain who they work with and why they choose to work with the said professionals. An example could be an architect, from whom you will require a set of house plans in the case of buying a vacant piece of land with a view to build your dream house. The real estate agent should be willing to provide you with a list of referring vendors including home inspectors, mortgage brokers and title companies. Request for an explanation whenever you see the term “affiliated” as this could mean that the real estate agent and their broker receive compensation from one or all vendors, and you could end up paying a premium price for their services. How much will you charge me for these services?
You don’t have to ask whether the fee is negotiable because all real estate fees are in fact negotiable – and so are commissions
. Estate agents will typically charge a percentage, from 1-4% for representing one side of a transaction, be it the seller or the buyer. Sellers will typically pay the commission of the real estate agent for both buyer and seller, while buyers typically cover the closing costs. Inquire whether the realtor would be willing to work with you on a commission that is reduced so as to encourage the sale to go through much faster. If you are a buyer and wish to encourage a seller to work together with you, you may request the realtor to reduce their commission such that the seller ends up paying less fees. How often will you be in communication with me?
Ideally, the real estate agent should regularly communicate with you and keep you updated with any new concerns or information. They should also keep you abreast with all offers on the real estate and be reachable most of the time, in case you have a new concern or question. What type of guarantee will you offer?
Should you sign an agreement with a real estate agent only to find out later that you are dissatisfied with the arrangement, will the realtor allow you to get out of the contract? Find out whether the estate agent will stand behind their services to you, as well as their company policy regarding canceled agreements. Be sure to also ask whether anyone has previously canceled an agreement with them before. Is there anything that I have not asked you that you believe I should know?
Pay very close attention to how the realtor will answer this question. Remember that there are always one or two things that you will need to know, always. What you want is a real estate agent who will take their time with you, and ensure you feel secure and comfortable with their experience and knowledge. The real estate agent should know how to listen and counsel you, as well as how to ask you the right questions with the aim of finding out what they need to know in order to serve you better.
Just as you want to size up the potential realtor to determine whether they would be a good fit, chances are the realtor will also be interviewing you. Beware of real estate agents who do not bother to ask you any questions to determine your motivation. Just as you would not work with any realtor you met on the street, professional estate agents are just as selective about the clients they take on.