Mortgage Daily

Published On: December 23, 2022

How Does a Real Estate Agent Assist You in Selling Your Home?

  • Your realtor will assist you in establishing your home’s asking price.
  • Real estate brokers list, promote, and show prospective purchasers your house.
  • Your representative helps you evaluate offers and negotiate with prospective purchasers.

The level of support you receive from an agent depends on the service you desire and your willingness to pay. Self-service brokerages, cheap brokerages, and full-service businesses are available.

How Can a Real Estate Agent Assist in the Sale of a Home?

Many customers learn at a young age that “cutting out the middleman” is a wise strategy. It “transfers savings to you.” However, if this is the case, why do 90% of house sellers engage a real estate agent, a middleman who typically costs 5% to 6% of the home’s selling price?

(This commission is shared equally with the buyer’s agent in most locations.)

What does a real estate agent do to deserve an $18,000 commission on selling a $300,000 home?

Do You Really Need an Agent?

Why not sell the property yourself? Then, you may either pocket the funds or subtract them from the asking price to entice additional customers.

Frequently, the answer is “no.”

For starters, several studies have demonstrated that, on average, houses sold without the assistance of a real estate agent garner lesser prices.

In one study, FSBO (For Sale By Owner) houses earned 6% less than those sold through the MLS (Multiple Listing Service) utilized by agents.

Additionally, selling needs considerable time, effort, and experience.

You might leave thousands of dollars on the table if you need more local real estate expertise and exceptional marketing and negotiation abilities.

A Skilled Agent Understands How to Price Your House

It is both an art and a science to know how to price a home accurately. It is likely the most important service a real estate professional can provide.

A competent realtor will employ science, in the form of recent comparable sales, to determine a realistic price for your home. She will utilize art, based on her expertise, intuition, and understanding of the local market, to adjust the pricing and ensure it is competitive.

A genuinely exceptional realtor will also be present for the house inspection and assessment to ensure that the reports are not “spun” adversely.

For instance, what if a home inspector recommends replacing the heater in five years? A buyer’s agent may interpret this as “defective furnace = reduced selling price.” Your agent will interpret this as “furnace is OK” and work to maintain the asking price.

Real Estate Agents vs Internet Valuation Methods (AVMs)

Why not utilize an online calculator? Aren’t the majority of them similarly correct in terms of pricing?

Not at all

For instance, Zillow asserts that its calculator has a median error rate of 4.3%, which indicates that the estimate should be within 4.3% of the home’s worth 50% of the time. The remaining residences have a bigger percentage variance.

How large is it?

The business claims that 87.6% of its online calculator’s estimations are within 20% of the actual figure, which is a substantial margin of error. (For a property costing $300,000, this is $60,000)

Although internet calculators utilize some of the same publicly accessible materials as agents, they do not consider curb appeal, recent renovations, proximity to schools, etc.

An Excellent Real Estate Agent Has Marketing Expertise

In the digital age, homebuyers frequently begin (and conclude) their tours of your property online. They see photographs and virtual tours of the home. They will only visit your home in person if they like what they see.

A reputable real estate agent will take high-quality photographs and videos of your home or hire a professional photographer.

Equally crucial, the agent will promote your property on the Multiple Listing Service (MLS), the network of databases that real estate brokers use to disseminate information about available homes, as well as social media sites like Facebook and Pinterest and (preferably) their website.

In addition, they will assist in arranging the home, hanging yard signs, hosting open houses, placing advertisements, and distributing fliers.

Could you accomplish this yourself? Sure. If you have the time and enjoy interacting with others.

(However, to obtain an MLS listing, you must engage a cheap broker and pay that service à la carte.)

Screening Out Non-qualified Buyers

Every lookie-loo and lowballer who has ever imbibed complimentary wine at an open house and claimed to be interested in purchasing will waste your time.

Even legitimately interested purchasers who have yet to secure finance might squander your time.

As commission-based employees, real estate salespeople are interested in weeding out unqualified purchasers so they can concentrate on the best possibilities.

In addition to eliminating apparent time-wasters, an agent will ensure that prospective buyers are pre-approved, not merely prequalified, for a mortgage.

Mortgage Pre-approval Equals (Nearly) Cash Buyer

An easy-to-obtain pre-qualification does not ensure that a buyer will receive a loan.

In contrast, purchasers who have been pre-approved have had their credit scores and incomes validated. They’re considerably more likely to obtain financing when it’s time to close.

Again, you can perform all of this yourself, provided you have the time and patience to do so.

You can also avoid the services of a real estate agent if you have exceptional bargaining abilities and engage a lawyer to draft or review the sale paperwork.

A Bargain Brokerage May Be for You

Consider a discount brokerage if you are an experienced seller seeking to save money.

Depending on the brokerage and your location, you can reduce the standard costs by several percentage points.

However, there may be better options than a budget brokerage if you’ve never sold a home before or want extensive assistance.

Discount brokerages compensate for lower charges by selling more homes; thus, you can not anticipate a great deal of customized care.

If you seek assistance with the “dirty labor” or want an MLS listing, you might take the next step. Sites such as Forsalebyowner.com provide a selection of services from which you may select.

However, remember that many of these sites pay commissions to buyers’ brokers as an incentive to direct prospects to your house. This is because sellers who provide 2% to 3% commissions are 25% more likely to sell than those who offer nothing.

 

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