Selling a home involves many critical and personal decisions. However, one of the most important decisions is the first decision you need to make—a decision that impacts your entire home sale:
Which real estate agent should you work with?
Unfortunately, many people make this decision based on the idea that all real estate agents are basically the same. They sign with the first agent to come along, or a friend or relative, only to realize too late that they should have shopped around and asked good questions.
Here are the questions you should ask each agent:
“Could you send me some information about yourself?”
You can often get a good idea of which agents are the committed and professional by looking at their personal marketing materials —brochures, direct mail, listing presentation book, etc. Call each name on your list and ask them to send out any information they can before you actually meet with them. When you get the “pre-listing” materials, look them over and determine your initial impression of what they’re bringing to the table.
Are the materials they provided professional? Were they delivered quickly? Do they give you an idea of how they would be marketing your home?
If not, you might ask yourself,
“If they don’t have the wherewithal to properly market themselves… how will they market my home?”
Also, keep track of how quickly and efficiently they respond to your request for information. Are they friendly and helpful? Or just pushy and hungry for a listing?
Does this seem like someone you’d be interested in talking with? If they aren’t organized and professional enough to respond promptly to your first request to find out more about them, they’ll probably handle potential buyers for your home the same way. If you like the way they respond to you and are impressed with the information they supply, call them and invite them to make a listing presentation to you. It’s always a good practice to meet with more than one potential agent before making a final decision—usually three to five for sellers. Just make sure that you don’t meet with more than one from the same company. This could cause internal strife which would be counterproductive in marketing your home.
“How do you approach your work?”
What you should be looking for, first and foremost, is an honest and knowledgeable broker. Someone who works full-time and has a team to support them. An agent that “Wears all the hats” may let something fall through the cracks. Length of time in the business and the number of transactions closed is very important. The dollar volume of what an agent has sold is not as meaningful as the number of transactions. An agent could close 5 transactions at $500,000 per transaction while another may have closed 25 transactions at $100,000 per transaction. Who has more experience? Always look to the number of transactions.
“How many homes have you listed in the past six months?”
Look for an agent who is active and has experience dealing with homes and situations like yours. This is especially critical if your home or transaction has special features or terms that may make it more challenging than the typical home sale.
“How many homes have you sold in the last six months?”
Beware of agents who simply gather listings and let them sit and wait for someone else to sell them. Your agent should have a good track record getting homes sold, which is after all your ultimate goal.
“What is the average length of time your listings are on the market?”
You may automatically assume the shorter time on the market, the better. But take note: If an average length of time on the market is significantly faster than the average for homes in the area, is it because this agent is more effective or because he or she likes to “low-ball” the asking price in order to get homes sold more quickly?
Also, take a look at what the original listing prices are for homes the agent has listed versus what the homes finally sell for. This “swing” number will tell you how effective the agent is at helping clients determine the right asking price and doing what it takes to help them get it.
“How long have you been full time in the business?”
Real estate is one of the toughest industries to survive in. According to the National Association of REALTOR’s the average agent in the United States closes only 6 transactions per year and 90% of new licensees leave the business after 2 years. Look for a full time professional that closes 30+ transactions per year and who has been in the business for at least 10 years.
“What professional organizations do you belong to?”
The minimum here should be a fully licensed professional who’s a member of the local real estate board and multiple listing service as well as the state and National Association of Realtors.® Local community groups and business associations may also be pluses in terms of networking and insight into the community. However, make sure your agent is focused on what’s important—selling your home.
“Do you have a personal assistant or other support staff working for you?”
Some agents employ an assistant or a complete team. This usually means you can expect better service. It can also be a good indicator that the agent treats selling real estate as a business. By employing someone to handle the small details, he or she can devote more time to serving your needs.
“Do you have any questions for me?”
In the interview, look for an agent who asks pointed, specific questions, not someone who’s just filling in blanks on a form. That’s the sign of someone who is already thinking about your situation and is creating a course of action specifically for you. Make sure you feel comfortable being around this person—you will be relying on their expertise.
“What marketing approach will you use for my home?”
Despite having the same basic marketing tools at their disposal—Multiple Listing Service, for sale signs, and personal networking—every real estate professional has a different marketing strategy. Learn each agent’s marketing philosophy, and determine what will work for you. The key is to find an agent who can invest their time and money to insure that every marketing appropriate for your home and circumstances are implemented.
“Will you produce a flier or brochure for my home and what will it look like?”
Take a careful look at the materials the agent has produced to market their current listings. Do the quality, design and wording of the materials seem to present each home in the best light? Put yourself in a potential buyer’s shoes: Would you be interested in the homes after seeing it presented by this agent?
“How often will you hold open houses?
Will they be public, broker-only or ‘by appointment only?’ How do you feel open houses will work best for my home?” Simply putting a sign on your lawn and holding an open house every Sunday afternoon won’t guarantee your home will sell. In addition, a house held open too frequently can begin to look like a loser, making it a target for low-ball buyers. Your agent should have a carefully-planned rationale for each open house, and it should be just one aspect of a complete system for success.
“What is your advertising plan for my home?”
Most people believe that advertising a home in the newspaper is the way a home gets sold. Unfortunately, this is simply not the case. The truth is: good real estate agents sell homes. And they do this through their own personal advertising, networking, skill, and creative advertising methods like the Internet, toll-free hotlines and fax marketing that give potential buyers 24-hour access to information about your home. Don’t be concerned with traditional methods of advertising houses. Make sure your agent uses innovative, cutting edge methods that make your home stand out from the rest.
“How will the property be exposed to other agents?”
Exposure is the key to any home sale. In many cases your home will be sold because another agent knows a buyer who is looking for a home like yours. Beyond simply listing your home in the MLS, your agent should be using a wide variety of techniques to let those other agents know about your home and keep them aware of it until it’s sold.
“Are you going to help me in staging my home?”
Preparing a property for sale, or “staging” it, is very important in maximizing the value and minimizing the time on the market. If a prospective agent does not mention this aspect of the sale on their own during the listing presentation, they probably has no plan to offer this service to you. They may also be afraid of bringing it up for fear of offending you by telling you about negative aspects of your home that should be changed — or positives that need to be highlighted — to increase its appeal to potential buyers. A confident and competent agent will find ways of broaching the subject and let you know of specific ideas, beyond baking of bread and putting out fresh flowers for open houses, to make your home more salable.
“What will you do to keep me informed?”
Do you want weekly or daily reports from your agent? Are you comfortable with letters, phone calls, email or do you want to discuss matters in person? Determine how much communication you want, then find an agent who will give you the attention and time you’re looking for. Remember, a great agent is usually a busy agent… be reasonable in your time demands.
“What listing price do you recommend for my home and what is that price based on?”
Pricing your home is the most critical step to selling it, and you should choose a Realtor® who has the knowledge to price your home wisely. Here are some things to keep in mind: Don’t go with a “yes man” who will promise a high price in order to get your listing—your home may languish on the market and they’ll let time take it’s toll until you reduce enough to get it sold. Also, don’t let an agent talk you into an artificially low price designed simply to sell as fast as possible. Have each agent their opinion of value with comparable properties and facts about current market conditions. The selling price should attract prospective buyers, reflect the condition of your home, and consider the current market. Be realistic… your home’s value is not based on your “needs” or how much you owe. A competent Realtor® will be honest with you about the value of your home and have the cold, hard facts to justify that value — both to you and to prospective buyers.
“Can you provide me with further resources that I may need?”
Most agents work with a team of professionals in many fields, including title, escrow, mortgage, home inspection, pest control, carpet cleaning, etc. While you are not obligated to work with an agent’s recommendation, often you may find it is the optimum way to go. The best agents have built strong relationships with other professionals, and can often get expedient service or be able to “call in a favor” for your transaction should a problem arise.
“Do you have references or testimonials from past clients you’ve worked with?”
Don’t be afraid to ask for references. This is not confidential information, even though many sellers would never think to ask for it. Real estate transactions are a matter of public record, and if you want to take the time to go down to the courthouse, you could compile your own list. However, any agent who provides good service and is proud of his or her work will be happy to provide references. If possible, contact a few of these references directly. Check to see how well the situations described by these previous clients fit your situation, particularly if you have a complex transaction or special circumstance that requires specific expertise like a “Short sale”.
“What does the listing agreement entail?”
The listing agreement is a legally binding document and your agent should be open and up front with you about exactly what you’re signing. Ask to know exactly what each portion means and be aware of what the contract will legally obligate you and the agent to do.
“What are the beginning and expiration dates of the listing agreement?”
This information should be included on the agreement itself and, should a dispute arise later, could be crucial in determining commission payments. Beware of agents who want you to agree to a very long listing period. Unless they can provide compelling reasons why your sale should take longer, generally three months is a good amount of time for a listing agreement. Also remember that the listing agreement is designed to protect not just you but the agent as well. Good agents work hard for their commissions and deserve just as much open communication and straightforward dealings as you do.
“What are the amount of brokerage fees I will be paying?”
The customary fee generally ranges between five and seven percent although brokerage fees are not fixed by law and are negotiable. However, whether you pay a fee that is higher or lower, you generally get what you pay for. Especially beware of agents who are willing up front to take a reduction in their commission. It may well mean that they never intend to spend much time, effort or money in selling your home to begin with. Additionally, if they aren’t able to negotiate their own professional fee how well will they be able to negotiate your price?
“What other costs do need to be aware of?”
Title insurance, escrow charges, closing costs and prorated insurance, taxes, rent, home owner’s association dues, etc.—the individual circumstances of your transaction, and the needs of your buyer, will all impact your final financial obligation. Be sure your agent goes over all the costs that may be incurred so that you’ll be prepared.
“What disclosure laws apply to me and what do I need to provide?”
You and your agent will both need to provide specific disclosure forms regarding the transaction and your property. Also, if you live in an earthquake, flood or other disaster-prone area, special statements—or special study zones reports—may be required. Ask your agent if they’ll help you organize a home marketing file—including a property fact sheet, a property transfer disclosure statement, pest control report, applicable C.C. & R.s, applicable special study zones report, available soils or structural engineering report, property profile from the title company, applicable plans for alterations or additions, any home warranty plan offered and applicable special equipment report for pools, spas, sprinkler and alarm systems, etc.
“What is a home warranty plan? Should consider buying one to help my sale?”
There are many ways to enhance the salability of your home and sweeten the deal for prospective buyers. You may not need them, but you should know what they are and how they may or may not benefit you.
“How will you determine the qualification of potential buyers?”
Ask what procedures the agent will use to make sure that you don’t waste any time dealing with dead-end offers or escrows that can’t be closed because the buyer in unable to secure the required financing.
“What happens if my home doesn’t sell in the allotted time; or, if I decide not to sell my home?”
Much of the answer to this question should be spelled out in the listing agreement. Make sure your agent goes over every part of it with you. Be sure to find out whether your contract contains a “liquidated damages” clause. These are designed to specify a dollar amount you would be liable for should you decide to take your house off the market before the expiration date of the agreement.
“What’s the best way for me to get in touch with you?”
In this age of expanding technology and instant communication, most agents have cell phones, voice mail and voice messaging services. You should know exactly how to get through to your agent, his or her assistant, or a messaging service in case of an emergency 24 hours a day. Your agent should not only provide you with prompt responses to your calls, but should also have a step-by-step plan regarding how he or she will keep you informed about the status of your transaction.
“How will you get feedback from the agents that show my home?”
Getting feedback from agents and their buyers who actually see your home is vital information to have. Does your agent have a system in place to have pertinent questions answered? How is that?
“How would you like for me to give you feedback?”
As important as it is for your agent to get feedback from the agents who show your home, its also important for them to get feedback from you. You should have a plan in place for your agent to receive regular feedback as to how satisfied you are with their service. The best agent is one who makes it easy for you to communicate any concerns about the way they’re handling your transaction. The more you can get all of your questions and concerns out in the open, the better the two of you can communicate and work to change things if need be.