The proliferation of services that help homebuyers and sellers complete their own real estate transactions is relatively recent, and it might have you questioning whether utilizing a real estate agent is ending up being an antique of a bygone age. While doing the work yourself can save you the significant commission rates many real estate agents command, for many, flying solo might not be the method to go-- and might end up being more pricey than a realtor's commission in the long run.
1. Much Better Access/More Convenience
A property agent's full-time task is to serve as a liaison between purchasers and sellers. This suggests that she or he will have easy access to all other residential or commercial properties listed by other representatives. Both the purchaser's and seller's agent work full time as real estate agents and they know what requires to be done to get a deal together. For example, if you are looking to purchase a home, a realty agent will track down houses that satisfy your criteria, get in touch with sellers' representatives and make visits for you to view the houses. If you are purchasing on your own, you will have to play this telephone tag yourself. This might be especially hard if you're purchasing homes that are for sale by owner.
Similarly, if you are seeking to offer your home yourself, you will have to obtain calls from interested parties, answer concerns and make appointments. Possible purchasers are likely to move on if you tend to be busy or do not respond rapidly enough. Alternatively, you might find yourself making a visit and rushing home, just to discover that nobody appears.
2. Negotiating Is Tricky Business
Many individuals do not like the concept of doing a real estate offer through an agent and feel that direct settlement between buyers and sellers is more transparent and allows the parties to better look after their own best interests. This is probably true-- assuming that both the buyer and seller in a given transaction are reasonable individuals who are able to get along. Unfortunately, this isn't always an easy relationship.
If you are working with an agent, you can reveal your contempt for the present owner's decorating abilities and tirade about how much it'll cost you to upgrade the home without insulting the owner. Your real estate agent can communicate your issues to the sellers' agent.
A real estate agent can also play the "bad guy" in a transaction, preventing the bad blood between a buyer and seller that can kill a deal. The same is true for the seller, who can benefit from a hard-nosed real estate agent who will represent their interests without turning off potential buyers who want to niggle about the price.
3. Contracts Can Be Hard To Handle
If you decide to buy or sell a home, the offer to purchase contract is there to secure you and ensure that you are able to revoke the offer if particular conditions aren't fulfilled. For instance, if you prepare to purchase a home with a home loan but you fail to make financing one of the conditions of the sale-- and you aren't approved for the mortgage-- you can lose your deposit on the home and could even be sued by the seller for failing to fulfill your end of the agreement.
A skilled realty agent deals with the same contracts and conditions regularly, and recognizes with which conditions need to be utilized, when they can securely be eliminated and how to use the contract to protect you, whether you're purchasing or offering your home.
4. Realty Agents Can't Lie
Well, OK, really they can. However since they are licensed professionals there are more effects if they do than for a personal purchaser or seller. If you are working with a licensed real estate agent under an agency contract, (i.e., a traditional, full-service commission agreement in which the agent accepts represent you), your agent will be bound by common law (in a lot of states) to a fiduciary relationship. Simply put, the agent view website is bound by license law to act in their clients' best interest (not his/her own).
In addition, many real estate agents depend on recommendations and repeat service to build the type of clientèle base they'll require to survive in business. This implies that doing what's finest for their clients ought to be as crucial to them as any private sale.
If you do find that your agent has actually gotten away with lying to you, you will have more avenues for recourse, such as through your agent's broker, professional association (such as the National Association Of Realtors) or possibly even in court if you can show that your agent has failed to support his fiduciary responsibilities.
When a purchaser and seller work together straight, they can (and ought to) look for legal counsel, but since each is anticipated to act in his or her benefit, there isn't much you can do if you learn later that you've been fooled about numerous offers or the home's condition. And having an attorney on retainer at any time you want to discuss possibly buying or selling a house might cost even more than an agent's commissions by the time the transaction is complete.
5. Not Everyone Can Save Money
Many individuals eschew using a property agent to conserve cash, but bear in mind that it is not likely that both the purchaser and seller will reap the benefits of not having to pay commissions. If you are selling your home on your own, you will price it based on the sale prices of other comparable residential or commercial properties in your location. Many of these properties will be sold with the help of an agent. This implies that the seller gets the keep the portion of the home's list price that may otherwise be paid to the property agent.
However, buyers who are aiming to buy a home sold by owners might also think they can save some cash on the home by not having an agent included. They may even expect it and make a deal accordingly. Unless purchaser and seller agree to split the cost savings, they can't both save the commission.
The Bottom Line
While there are definitely people who are qualified to offer their own homes, taking a peek at the long list of frequently asked questions on many "for sale by owner" sites recommends the process isn't as easy as many people assume. And when you enter a tight spot, it can really pay to have a professional in your corner.