When the decision is made to purchase a home, the buyer sometimes can become emotionally charged with energy. Many first time buyers think if they work through a realtor, it automatically means the realtor is working toward their best interest; when in fact, many realtors are seeing a potential buyer as an easy sale and will turn certain facts around just to get them to buy. When the saying states, “Buyer beware,” it speaks the truth.
Not every realtor sees new home buyers as inexperienced and an easy sale but what characteristics and circumstances can give hints that a realtor only has their own interest and profit in mind, and not yours? Realtors are salespeople; no matter of your past experiences being good or bad they make their income and living by selling homes and taking a percentage of the sale.
The first thing to do before even calling a realtor is make a list of everything you are looking for in a new home from the area you want to live, the type of property, if there is public transportation within walking distance, to the price. Once the list is made, next decide which factors you are willing to give up or negotiate. After these decisions are made by the individual buyer, then call a realtor and tell them exactly what you are looking for in a home and refer to your list.
The list is set and the top priorities are the area which you want to live, public transportation within walking distance from your new home, and the highest amount of price. Secondary, you decided that you are willing to look at town homes and not just single family homes. When you meet with the realtor, all these factors have been given to them and when they find properties, you agree to go around with them.
A week goes by and you receive an email from the realtor saying they found properties with all your preferences and could you meet with them tomorrow. You respond yes and the appointment is set. Usually buyers will meet the realtor at their office and the realtor will drive to the properties they are showing. Instead of having copies or a whole packet of all the MLS listings, she hands them to you one at a time as you are approaching the home. The first home is not in the area you want to live but you decide to go in anyway since the realtor did make the effort to bring you. As soon as you walk in, you know instantly this is not the place for you. When you ask her about the public transportation she doesn’t even know the answer! At this point, when you get back into her car, ask for all the MLS listings she plans on showing you that day and see if any are in the area you told her and ask about the other factors important to you.
Unfortunately you find out that this realtor did not take your requests seriously and in conversation, you found out that the homes she showed are homes she is the listing agent for. When a realtor is the listing agent and the buyer’s agent, the realtor gets the full commission and doesn’t have to split it with any other realtor. For example, a home is listed at $400,000 by Realtor A. Realtor A finds the buyer for this home and gets the full 6% commission. The realtor makes $24,000 off this sale. Now if Realtor A doesn’t find a buyer and Realtor B finds a buyer, then the two realtors decide on how the commission will be spilt. Either they spilt it 50/50 or give 2% to the buyer’s Realtor B and takes 4% for herself, Realtor A.
Remember, not all realtors will take advantage of potential buyers but realize that not every one has your best interest in mind. Decide yourself first about the important factors when buying a home before meeting any realtor. All realtors will ask what factors are you looking for in a new home but how they execute finding them is what makes the helpful, honest realtors stand out over the dishonest ones.
Choosing a Realtor when Buying your Next Home
When it’s time to buy or sell a home, you need to shop as carefully for a realtor as you do for your new home. Choosing a realtor should be something you undertake only once you have done some research. After all, this person is going to help you make one of the most costly decisions of your life, so take some time to make the best decision you can.
How to Choose a Realtor
1. Talk to family and friends. Get the names of realtors who are known and trusted.
2. Check local listings to learn which realtors represent properties like the one you wish to sell or buy. Some realtors specialize in condos. Some specialize in high end properties or helping first time buyers.
3. Learn if you are dealing with a buyer’s realtor. Some realtors will say they represent both the seller and the buyer but this simply is not true. A realtor cannot fairly or equally represent both parties. You need a realtor who has only your interests at heart.
4. Make appointments with three realtors. Let them know your goals in terms of budget and timeframe. Explain what kind of dream house you are hoping to find.
Ask for some suggestions on properties currently available. These appointments will help you to learn more about the personality of each realtor as well as how comfortable you are with their suggestions. Do they listen carefully and respond appropriately to your stated price range or do they attempt to sell you something bigger or more expensive?
5. Never ever pay an agent for services. The fees are not to come out of your pocket but out of the commission of the sale of the home.
If you find a great realtor who helps you to find a great home then you might want to send a “thank you” note and maybe a small appreciation gift. Though, the best “thank you” to a realtor is when you offer the names of family and friends who are looking to soon buy their next home!