The Value of Using a Licensed Real Estate Agent
There are times to DIY (do it yourself), and there are times to call in an expert. Buying a home is not the time to try your hand at real estate negotiations. Can you buy a home without an agent? Of course you can—just as you can sell a home without an agent—but those decisions tend to cost you in time, energy and, most of all, money!
In either scenario, if you’re unrepresented, you’re likely to get the raw end of the deal if the other party is working with an agent (and chances are, they are). This doesn’t make you a bad businessperson; you just don’t know what you don’t know.
While a real estate agent’s job may look like it consists of showing you the same houses you see online, submitting an offer you could’ve delivered yourself, and then collecting a commission, they do so, so much more than this. Contracts, anyone? Disclosures? Counteroffers? Comps?
The advantages of using a real estate agent are plentiful once you take a step back and look at their role from a 360-degree view. In fact, in a recent study by the National Association of REALTORS®, it showed that typical “for sale by owner” properties sold for $217,900 nationally, compared to an average of $295,000 nationally for those who used an agent.
They’re in the Know
Online listing websites are nice, especially when you’re first getting started. You can get a sense for what the neighborhoods are like, common home and community features, and your ideal price range.
In fact, it’s smart to jump online, educate yourself about your preferences and deal breakers and then take that information to a real estate agent who can home in on the options best suited for you. One of the advantages of using a real estate agent is that they’re the first to know when a home hits the market —and sometimes even before! Agents live and work inside of the Multiple Listing Service (MLS) on a daily basis. They see how hot a listing is so you can get in and see it (and make an offer) before it disappears.
The MLS also gives information in real time, so when a property is listed, or a price is reduced—or even if an offer falls though—it hits the MLS immediately, whereas public online resources take time to get the information and populate their website. If you’re waiting for properties to appear on the public online real estate marketplaces, you’re already behind and, in a competitive market, you may have lost precious time for a desirable listing.
They’re Connected
Having access to the MLS is a definitely one of the advantages of using a real estate agent, but what if you can get in even earlier? Like before the listing is even public. Unless you have it on good faith that a family friend is listing their house soon, chances are you have no way of knowing when a home is getting ready to hit the market.
But real estate agents do. It’s their job to stay connected. They know they can’t serve their clients to the best of their abilities if they’re unable to bring the best listings to their doorstep. So they network. They stay connected. They talk. A lot.
An agent who excels at all of the above will be well informed before a home is listed for sale. This gives you an even better edge against the competition! Some sellers also prefer to sell their home “off market,” meaning they don’t list it publicly. Without a well-connected agent who has a large network of colleagues, referral partners, and clients, there’s almost no chance you’ll be able to nab one of those listings.
They’re Good at What They Do
Whatever you do all day long, we’re willing to bet you’re leaps and bounds better at it than the average person. Why? Practice. Experience. Talent. Real estate agents are no different. They spend all day, every day, finding homes and pairing up buyers and sellers.
The advantage of using a real estate agent is that they know what you need to do to find the home of your dreams, settle on an agreeable price, complete your due diligence, and get the deal done.
This goes back to that point about not knowing what you don’t know. What an untrained eye sees when they walk into a home they’ve been salivating over online versus what a trained professional sees can be night and day. While you’re focused on paint color and that huge walk-in closet, they’re doing a visual tally of whether this home is reasonably priced, what items may need attention, and where they can find leverage in the negotiating process.
Many buyers and sellers believe they’ll save tons of money if they go it alone. After all, agent commissions can seem stiff! But they’re nothing compared to the costs of a voided contract, money you left on the table, or pricey home repairs that weren’t addressed before you sign on the dotted line.
They’re Fast at What They Do
Interest rates are low right now, and many cities have low inventory. As you can imagine, this increases competition among homebuyers. In an environment like this, time is of the essence. You can’t afford to lose a home because you’re still learning the ropes surrounding the homebuying process.
So do yourself a favor and unlock the many advantages of using a real estate agent. Agents know what questions to ask, what tasks need to be completed, and what paperwork must be filled out. They also provide confidence to the seller and their agent, especially if they need to sell their home quickly. If you’re working with an agent, they’ll know the transaction is in good hands and will continue to move along without any hiccups from an inexperienced buyer.
Inexperience breeds uncertainty when you’re talking about an investment as large and important as a home. In a competitive atmosphere, you don’t want to do anything to rock the boat, rattle the seller, or have them choose another offer—even a lower offer—because they don’t feel secure in your abilities to get this deal done. Save yourself the trouble and hire a professional.
They’ve got the Legalese Down
Buying a home is a very formal, official, legal process, and it needs to be treated as such. This is not the time to pull template contracts off the internet! When you’re talking about the advantages of using a real estate agent, their know-how of the protocols, forms, costs, and fees cannot be overstated. The last thing you want to do is sell your house and find out a few days later that the current owners of your new home decided to back out—and that they totally can—because your contract isn’t legal or binding.
While a real estate lawyer can help you understand the paperwork you’re signing, they’re not always necessary and they can be expensive (it is your decision whether to seek further counsel when buying a home). A real estate agent isn’t a lawyer but their job requires them to be experts in all official documents related to the homebuying process. This includes appraisals, inspections, repairs, disclosures, and buying/selling contracts.
It never hurts to have a second set of eyes take a look at these forms, but your agent will be able to go through all the paperwork with you, answer any questions you may have and, if necessary, discuss any changes and/or complexities with the other party.
There is a Spanish proverb that translates to “the cheap comes out expensive.” Few places is this more true than when buying a home. While it may seem “empowering” to go it alone and save that commission, what you stand to lose typically far outweighs any benefit of buying or selling a home without representation.
If us laymen could buy or sell homes easily on our own, we wouldn’t need real estate agents. But that’s been proven time and time again to not be an effective strategy. So do your homework. Find the best agent you can and ask them as many questions as you want before hiring them. Then enjoy the advantages of using a real estate agent.
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