You’ll find The Larson Team's blog to be a wealth of information, covering everything from Southwest Florida's real estate market statistics and home values to community happenings around Sarasota & Charlotte County Florida. That’s because we care about the community and want to help you find your place in it. Please reach out if you have any questions at all. We’d love to talk with you!
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If you think that real estate fair market value and real estate assessed value have any relation to one another, then you are mistaken!
As you read further in this article, you’re going to learn the difference between assessed and fair market real estate values.
Over the last five years, while working as a Florida Realtor, one misconception that buyers & sellers have is they draw a definitive correlation between a home's assessed value, and it’s fair market value.
So, let’s set the record straight – there is usually very little correlation between the two figures most of the time.
Some of the biggest perpetrators who might misuse this information are real estate agents themselves! However, a real estate agent who’s going to discuss a homes fair market value in relation to its assessed value will only do so if it sheds a positive light on the property they are going to be marketing.
More often than not, the public gets confused about this because some real estate agents fail to educate their customers that there is a huge difference between an assessed value vs. fair market value. Looking at a home's assessed value is about as good as using a Zestimate to find out what the value of your homes is! If you’ve done any research on Zillow, then you know how inaccurate their home values can be, their homes' values they give you can be off up to as much as 20%.
When the real estate assessed value Sarasota County, Florida or Charlotte County, Florida assessor places on a home that is higher than what a property is listed on the market for you will many times see a real estate agents advertisements say something like this “Come see this bargain home that is priced $50,000 less than the assessed value”.
What this tells me straight away is that the real estate agent is either not properly educated on property valuation’s or they believe there will be someone dumb enough to think the home is the steal of the century. People who are properly educated will know better and will realize the property has been over-assessed by the county and the seller has been overpaying on their taxes!
On the flip side of this scenario are homebuyers who see a home listed higher than it's assessed value. If they haven’t been properly educated by their buyer’s agent, they will try to use this data when it comes to negotiations when submitting an offer.
An argument buyers make is that their offer is a particular dollar amount based off of what the assessed value happens to be.
If more real estate agents did a better job at educating their customers about the difference between a properties fair market value and assessed value, there would be a lot less confusion,and buyers wouldn’t be trying to correlate real estate assessed value to the fair market value.
Typically, assessed values are a useless piece of data when trying to figure out Real Estate values.
Here in Southwest Florida, most individuals realize Real Estate values can go up or down depending on the real estate market over a couple of years. As property values either increase or decrease, some people think their taxes would do the same.
So what that means is the county or city you live in is going to need to get “X” amount of money every year to be able to run the county or city.
When market values of homes start dropping assessments will eventually catch up to them. However, the city or county will increase the tax rate as necessary to make sure they will still get the funds they need to cover their budget.
You also need to keep in mind that a properties assessed value usually lags behind the market value because the assessed valuations are not re-calculated until the beginning of the next calendar year.
So if the market values of properties are declining, usually you’ll see the assessed value being higher than the market value and vice versa, if you see market values increasing you’ll see the assessed value less than the market value.
While being in Real Estate, I have seen some of the weirdest things when it comes to a homes assessed value. Believe it or not, there have been times when you’ll see some homes that are tens of thousands of dollars over or under their assessed value in comparison to their sales price.
Homes that have re-sold more recently will usually have a more accurate correlation of their market value vs. assessed value than a house that has not sold in a long time, especially in Florida if the home has been homesteaded and is using Florida’s “Save our Homes Program”, where assessed home values can’t increase more than 3% year over year.
A good example is a home that sold a couple of years ago usually will have a stronger correlation than a house sold fifteen years ago and was homesteaded, and was under the “Save our Homes Program”.
Another example of how assessments can become skewed is when a homeowner thinks they are being over-assessed by the city or county, and files a challenge, and wins an abatement. Their assessed value will then be changed to the lower amount.
So how do real estate fair market value and assessed value differ from one another?
The fair market value of real estate is what a buyer is willing to pay for a property on the open market with no undue influence.
In real estate, there is a term called an “arms-length transaction” that is mentioned frequently. A good example of a “non-arms length transaction” would be there is a family member purchases a property at a discount to what it would have sold for otherwise.
Sometimes in real estate, if one family member is going to buy from another family member, they don’t always purchase the property at the full market value of that property. Under these circumstances, you wouldn’t be able to conclude that the property is worth the reduced sales price.
If however, the property was listed on the market and all real estate buyers had an equal shot to purchase the home, it would be concluded that when that home sells, the sale price would end up being the homes fair market value.
There are also some other examples in real estate when there are situations where properties are not sold for their fair market value.
A few of these situations are when someone is selling a home in divorce or when an owner gets transferred for work to another part of the country.
There are times when selling is constrained by timeframes, and a seller may want to discount the sales price to get the home sold quickly.
Then there’s distressed property or Bank-Owned properties which will usually sell under full fair market value. A distressed property can mean any number of things – examples can include an unusual amount of foreclosures homes close to the home, a property close to an airport and in the airport's flight path, the property is in a high-risk flood zone, or other similar types of issues that could cause homebuyers to look elsewhere for homes.
Being a homeowner, the only true way you can determine what real estate fair market value is by looking at what other similar properties have sold for in your area.
Usually, the sales must have occurred within the past six months to be considered a comparative sale. Anything over six months lenders and appraisers will not look at. The that should be compared are homes that should be of similar size, style, and characteristics.
Both a knowledgeable Realtor or an appraiser will be able to determine your home's real estate market value. Like anything else, evaluating the fair market value of real estate is a skill a knowledgeable Realtor should have.
Some real estate agents can be clueless when it comes to properly evaluating a property's fair market value!
Another additional thing to remember is that a property's appraised value is not necessarily the same thing as when a Realtor provides you a fair market value or comparative market analysis.
A home appraisal is conducted by a certified appraiser. An appraisal is done in a real estate transaction when the buyer is getting a mortgage to purchase the home. The lender requires an appraisal so they can make sure that they are lending money on a home that has a value equal to or higher than the purchase price.
An appraisal will also be done if a homeowner is looking to re-finance their home into a new mortgage. Theoretically, the fair market value and appraised value should be pretty similar. When an appraiser and Realtor determine fair market value, they’ll both use comparable home sales data to come to a definitive property value.
However, these two numbers are nothing more than opinions of value. But, they both, should be based on previous home sales data that a reasonable person would think is substantially similar.
Often a homeowner will buy a property for X number of dollars. Then after getting their tax bill, they feel that the assessed value is out of line vs. what the fair market value is. There’s no surprise this happens more often than not!
So what should you do if you think your assessed value is out of line with similar homes in your local neighborhood, or city?
You can head over to your local tax assessor’s office and file what is called a tax abatement! All the needed information regarding how the application process takes and any deadlines for filing should be made available to you at your local tax assessors office.
Applications for tax abatements are due on or before the due date for payment of your first tax bill.
Basically, a property's assessed value is a valuation placed on a property by the county tax assessor for the sole purpose of taxation. Fair Market Value of a property, on the other hand, is the agreed-upon purchase price between a willing buyer and seller under usual and ordinary circumstances in a real estate transaction. Fair Market Value is the highest price that the property will bring when listed and marketed for sale on the open market to a buyer who is purchasing with full knowledge of the property's highest and best use.
I hope, after reading this article, you have now figured out that a properties assessed value has nothing to do with it’s fair market value.
Other resources concerning real estate valuation worth a look:
Use the additional resources regarding real estate assessed value vs fair market value to not only educate yourself on these two distinct terms but to also price your home correctly when selling.
Thinking of Selling your home in Sarasota, Manatee or Charlotte County area of Florida? It is extremely important to make sure you price your home correctly. We’d love to prepare a complimentary comparative market analysis specifically designed and tailored for your home! In addition, we create a comprehensive marketing plan that is also designed specifically for each of our homes for sale, so contact The Larson Team today!
We service the following areas in Florida: North Port, FL, Longboat Key, FL, Boca Grande, FL, Siesta Key, FL, Bradenton, FL, Sarasota, FL, Osprey, FL, Nokomis, FL, Venice, FL, Englewood, FL, Port Charlotte, FL, Rotonda West, FL, Punta Gorda, FL,
Visit our website at WWW.LARSONSOLD.COM.
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What Do Real Estate Agents Charge For Commission?
One question you hear a lot being, a real estate agent is, “What is your commission rate”? One thing everyone should know right from the start is that real estate commissions are entirely negotiable, and they are generally split, 4 ways, not including the split with “Uncle Sam” and we’ll get into that later.
There isn’t anything anywhere that says a commission needs to be a certain amount of money. So, what one real estate company or agent charges fora commission can be completely different from another firm or agent down the road.
In real estate franchises like RE/MAX, the real estate agent is completely empowered to decide what they will charge for a commission. However, with most real estate franchises, the owner of the franchise will determine what the agents will charge for a commission, and when if the situation arises where an agent is asked to reduce their commission, the agent will usually need to ask for permission from the owner of the franchise.
When using an experienced and reputable Realtor® they will make the home buying and home selling process much more comfortable, efficient, and productive for their clients.
Realtors® do need to be paid for their services, which usually means paying them a commission from the home sale of the property. There are people who feel like real estate agents are paid way too much, while there are others who think thatRealtors® do not make enough for all their hard work, long hours, and sacrificing time with their family to work. There are some consumers who will choose to sell their home for sale by owner without the help of a Realtor in the hopes that they will save money by not paying a commission.
Typically, the fees that real estate agents will charge will depend on the area you live in and the type of home you are trying to sell. It’s not possible to list all the commission rates for your area, but we can give a little overview of how real estate commissions work and what some common commissions are.
Real Estate Commissions – What You Should Know
Typically, The Seller Will Pay The Fee.
In most real estate transactions, it’s the seller who ends up paying the real estate agent’s commission. The reason being is that the seller paying the commission makes a lot more sense since the sale of their home will produce a large payout for the seller, and the seller’s agent has to do a lot of work to make that sale happen. Again, the listing agent's commission can vary and is negotiable, but often it will be somewhere in the range of 4% - 7%.
The most common commission you’ll pay to sell your home, depending on what part of Florida you’re located in, is going to be between 5-6% percent of the sales price.
Since the seller is the one who typically will be paying the commission, it is important that the seller do their due diligence before selecting an agent. If you are the one selling a home, you should interview at a minimum 3 real estate agents to find the one that fits your specific needs and, overall, the one who has a personality that you can work with and you feel comfortable with.
Once you hire the right agent, they will go to work for you to get your home sold and make sure that you get the best possible deal from the transaction.
There is No Set Commission
As previously, mentioned commission rates are one hundred percent negotiable between a real estate agent and their client. While there might be a typical rate in your particular area, there is absolutely no set commission rate, Realtor fee, or standard percentage. People may wonder why that’s the case, and it because of what’s known as the Sherman Antitrust Act. The act was put in place to prohibit businesses from getting together and barring competition.
Basically, the Act prohibits all the real estate agencies in a given area from getting together and agreeing to set commission rates. Doing this would lead to collusion and setting commission income. However, that doesn’t mean a real estate brokerage can’t tell all their agents to charge a specific rate when listing a home for sale. This is completely legal and is at the discretion of the real estate broker.
A lawsuit filed in 1979, was filed against 3 Real estate Brokerages & 3 Individuals, the case is United States v. P Foley which tied up real estate agent commissions with antitrust laws. The case heavily scrutinized real estate agent fees and changed how real estate brokers conduct themselves as it relates to compensation from clients.
Due to the Sherman Antitrust Act, real estate agents need to be careful about what they when it relates to how much they charge for commission.
Seller’s Agents Often Split The Commission With a Buyer’s Agent And Their Broker.
As previously mentioned at the start of this article, the commission is usually split four ways on a transaction. The seller’s agent often splits the commission with a buyer’s agent 50/50, then typically both the seller’s agent & the buyer’s agent will have to split their commission with their broker as well, which their split with their broker can range anywhere from 0-50% of the commission the agent received from their side of the transaction. After all, that’s said and done, then there comes the split no one can avoid, “Uncle Sam”, which as a rule the agent should set aside roughly 20-30% of their commission to pay their taxes at the end of the year.
As a seller, it is usually a good idea not to discount the commission that the buyer agent will be paid. Doing so could make your home harder to sell and net you less money, not more.
Sometimes Commissions Get Discounted
Another question often asked by sellers to real estate agents is whether or not there will be a discount if the listing agent procures the buyer themselves. More often than not, agents are willing to discount their fees if they do get both the buying and selling side of a transaction.
Another instance where real estate agents are typically willing to discount their commission is when they work with a client who is buying and also selling a home through them. You just need to ask! If an agent thinks clearly, they will agree with your request.
Flat Fee Entry Only Agents
It is worth noting there’s another type of commission arrangement that has popped up recently over the last decade or so and, is known as entry only flat fee commission. This is an arrangement, where a broker will list a property for a flat fee, put it in the Multiple Listing Service ( MLS ), and not to anything more than that.
This is usually used when you’re doing a “For Sale By Owner” or FSBO where the owner gets to sell their property on their own but also has the privilege of placing their home in the MLS. In this scenario, the seller does all of the work. The agent does none of the traditional marketing activities. The seller also has no representation. There are some significant pros and cons to marketing a home in this fashion.
Different Realtors® Get Paid in Different Ways.
So, to go back to how agents are paid and how commissions are split by an agent and their broker, here is a more in-depth overview. There are a variety of arrangements real estate agents make with each other and with brokers. Most real estate agents are considered independent contractors and solely rely on the commissions they earn. So, depending on what brokerage an agent works for, the brokerage's commission policy will dictate how the agent’s pay is calculated.
According to the National Association of Realtors®, some of the ways that real estate agent pay is broken down include the following:
How Much Does A Realtor® Make?
Do you know how much real estate agents make in commission? Many people think that real estate agents make a ton of money & drive Ferrari’s while lounging around the poolside all day. However, that is not the case. While top agents can make an excellent income, the average agent does not. As Feb.26th, 2020 the average yearly commission for a Realtor® was $42,183. This was up from $41,289 in 2019.
Income was generally in line with experience. So, Realtors® with 16 yrs. or more experience had a median gross income of $78,000, while Realtors® with 2yrs. or less experience had a median gross income of $9,300.
It is important to note that unlike most businesses that have an 80/20 rule, whereby 80% of the business is done by 20% of their members, in real estate it’s 93/7. Which is 93% of all real estate transactions are done by 7% of the agents.
Again, the majority of times commissions are usually split in four ways. The listing firm, the listing agent, the selling firm, and the selling agent typically split the commission in some fashion.
Consumers should also understand that there is a difference between a Realtor® and a real estate agent.
The Fees a Real Estate Agent Charges Will Vary Depending on Their Role.
Determining what a real estate agent does and who they work for can be confusing sometimes if you just go off of terms and titles – a good example, is sometimes the buyer’s agent can be called the selling agent, and a listing agent is a term used for the agent working for the seller. So, make sure you know what you are getting into, and ask the agent to clarify who they work for and if they charge any upfront fees.
As a seller, you’ll want a Realtor® who will work on getting you the highest possible sales price, or a combination of a high sales price or other contract terms that are desirable to you, such as a quick sale, so you can move to another area and buy a new home. As a buyer, you’ll want an agent that will work to get you the best possible deal on the house that you want.
What About an Agent Bonus?
There will be times, typically when the market is in favor of buyers, that some sellers will offer what’s known as an agent commission bonus to get their home sold. A while ago, before the emergence of buyer’s agents, doing so made more sense.
The reason for the agent bonus is that it was an incentive used to get agents to sell their property. With the arrival of buyer’s agents, it makes a lot less sense. Why? If you are a buyer’s agent, the commission that is being offered should have no effect on whether an agent shows a client a specific property or the advice they give you.
Realtors® Do A Lot For The Money
At first look at the fees that a real estate agent may charge, it can be a little shocking. After all, it is your house that you are selling, and you want to make sure you get as much from that sale as possible. In actuality, though, Realtors® tend to make less than you think after all the splits and fees are calculated in, not including the cost of marketing your home.
The money you pay for a great real estate agent is more of an investment. The real estate agent is motivated to sell your home for a great price because that means more income for them. Many people wonder what a real estate agent does all day. It is a lot more than most people think.
Here is a quick summary of what a great Realtor® does to earn their commission:
Do You Pay a Realtor® if Your Home Doesn’t Sell?
Typically, the answer is no. Real estate agents are in a business that is a performance-based business. In our Florida, real estate contract there is language stating that a real estate agent will only get paid if and when the property closes. However, in some contracts, there will be wording that if a buyer is successfully procured and you as the seller break the contract, you will still owe the agency a commission.
When you’re signing a listing agreement, it is important to read over the fine print and know exactly what you are agreeing to. There are some occasions when a seller may want to fire their real estate agent for lack of performance and getting out of a contract might not be as easy as you think.
The same thing can be said if you hire a buyer’s agent and sign a buyer’s agency agreement with the buyer's agent.
No matter if you are buying or selling a home, it is important to interview the real estate agent you want to hire. If an agent does an excellent job, then the commission you end up paying will end up being worth it. However, getting stuck with a horrible agent, you’re likely to feel the exact opposite. Even though knowing how much a real estate agent charges for a commission is important it, should not be the only factor in making a hiring decision.
Many people wonder what does a real estate agent actually does all day. People might think we sit around all day waiting for our phones to ring, non-stop with new clients or if we really do anything special for our buyers and sellers? Or is what you see on HGTV really what a real estate agent does?
In the age of modern technology or being a DIYer, a lot of people often make the mistake of thinking that a real estate agent is an unnecessary expense when buying or selling a home. But assuming that can be a costly mistake, especially if you’re trying to sell your home for sale by owner, which is not as easy as one thinks!
With so many online resources available to people nowadays it does make it possible to handle some of the work involved in a real estate transaction without the help of a realtor, but those online resources are not a replacement for a true real estate professional.
To get the best possible outcome in any real estate transaction when there could be hundreds of thousands of dollars or more on the line, you need to work with a real estate agent who is experienced. The first thing you should know is that there is a difference between a Real Estate agent, a Realtor, and a broker. However, these terms get used interchangeably all the time but have distinct differences.
Choosing the right real estate agent to work can really be dependent upon whether you’re a buyer or seller. The reason being is that both processes are different. Some agents are much better at facilitating one side of the real estate transaction than the other. For instance, a Buyer’s agent might have a different skill set than the seller’s agent and vice versa.
So, let’s dive in and take a look at what real estate agents and Realtors do for their buyers and sellers to better understand why it is worth hiring the right real estate agent the first time.
What do Real Estate Agents Do for You?
We’ll Start Off With What A Buyer’s Agent Does For Their Buyer.
There is a serious distinction that needs to be made about a true buyer’s agents and an agent who is just looking to make a sale. The best buyer’s agents truly care about only one thing and one thing only, which is their buyer’s best interests! There are many reasons it’s good to have a buyer’s agent representing you when purchasing a house.
1. Get you pre-approved for a loan.
A top-notch real estate agent will have a network of lenders, that they can refer you to so that you can start the most important step of the home buying process, which is getting a pre-approval letter from a lender There’s no doubt, you’ll want to be pre-approved, especially when you’re in a competitive real estate market like we have in Southwest Florida. There is a couple of reason you want to have your pre-approval letter ready before you start shopping for a home, one reason is that you’ll know exactly what your price range is for your new home, along with an estimated monthly mortgage payment amount, another great reason to have your pre-approval letter is, so that when you do find that perfect home in Southwest Florida, you are ready to make an offer right away, because typically here in Florida, listing agents are going to want a pre-approval letter submitted with your offer.
2. Will Show You Homes That Fit Your Needs.
Looking for a new home can exhausting & stressful even when everything goes smoothly. A top REALTOR® can narrow down your home search that will save you time and energy by asking you detailed questions to help you find exactly what you want in your new home. They will be able to help you focus on the right property type, location, neighborhood, school district, and more.
It will still take time and energy to shop for the right home, however, a lot of that time and energy will now be your Realtors. Showing a potential buyer a home they like is one of the least important tasks for a real estate agent.
3. Negotiating Your Offer.
When you do find that perfect home that you want, which will be the one that really excites you after seeing it in person, it will be time to make an offer. However, should you be offering? Trying to make a low ball offer isn’t a smart idea, and the reason is, is that it will probably be ignored or upset the seller, who may reject any further offers you might submit to them.
On the other hand, you don’t want to offer too much either, as no one wants to spend more money than they have to when purchasing a home or anything for that matter. So, a good real estate agent will run comparable sales in the area of the home you want to submit an offer on and give you guidance as to what your offer should be.
4. Find The Right Home Inspector.
With anything, there are some things that are better than others and that is still true with home inspectors. A top real estate agent will know who are the best home inspectors in your area and can connect you with them. It’s very important that you have the home inspected before you continue with purchasing so that you avoid purchasing a money pit.
A top real estate agent will encourage you to get the home inspected using a reputable inspector that you can depend on. After the home inspection, your agent will help you decide if you need additional inspections, like mold or Chinese drywall or septic inspection .
5. Attend Your home inspection.
Even Home inspectors can sometimes miss a problem, so that’s why you want to have a set of second eyes there. The best REALTORS® who are truly focused on representing their buyer’s best interests to the fullest will be there during the home inspection to make sure everything goes as it should. They will also be there for you to explain the results of the home inspection.
There are times when buyers can really struggle with knowing what problems are worth stressing over and which ones are not. A top real estate agent will go over your inspection report with you to help you decide which issues are the ones you need to most concerned with.
6. Help You Negotiate Repair Requests.
Sometimes, there will be issues that you’ll find through the home inspection that you might have to discuss with the seller. Your real estate agent will be able to tell exactly what problems you need should bring up for negotiations and will be able to handle the renegotiation process for you.
Some common ways to negotiate repairs is for the seller to reduce the sale price of the, make the necessary repairs requested, issue a credit at closing for the repairs, which then you’ll be able to select your own trusted contractor or some other seller concession that is justified due to the problems with the home. Renegotiating after the inspection due to issues found on the inspection report is pretty common, and you’ll want to have someone who is skilled at doing it.
7. Communicating with the seller’s agent & title company throughout the process.
Things are always changing during a real estate transaction. Each time something changes it’s extremely important that everyone involved in the transaction is made aware of the change so that everyone is on the same page and can take the necessary steps to correct an issue if it comes up. A great real estate agent will keep up open lines of communication between all the parties to keep the transaction moving along.
This is where impeccable communication skills is one of the telltale signs of an excellent agent, whether they are representing a buyer or seller in the real estate transaction.
8. Monitor your loan commitment with your lender.
A highly skilled real estate agent knows that just as easy as it was to get a mortgage loan pre-approval, it’s just as easy to get that mortgage loan pre-approval taken away. Mortgage pre-approvals are based off of your financial situation when you submitted your initial application to your lender, and any major financial changes you make after that can cause the loan to fall through. No one wants this to happen to you, so a great agent will keep track of your mortgage for you and advise you on how to protect your approval. Some common mistakes that buyer’s make, during the loan process is opening new lines of credit, employment changes, refinancing an auto loan, which will adversely affect your credit score and could potentially now get your mortgage loan denied
Another important step is your mortgage commitment date it’s a very important date that’s in your contract and you want to make sure a mortgage commitment is given by your lender by this date. If a mortgage commitment isn’t received by your lender, your buyer’s agent better be on the phone, getting you an extension from the seller. Because you could lose the house and your escrow deposit. Again, something no one wants to happen.
9. Clear Up Any Final Details Prior To Closing.
Prior to closing, there are still some details that need to be addressed before finalizing a closing. You’ll enough stuff going on prior to closing on your new home, so it’s important that your real estate agent is there for you to make sure that all of the remaining details are taken care of, so you can close on your new home without any issues.
One of the most important steps prior to closing is doing a final walkthrough of the home, the reason you do a final walkthrough is to make sure the home is in the same condition as it was when you made your initial offer. However, there is something that does cause a problem, your real estate agent will be there to advise you on how you should move forward with the transaction.
What Exactly Do Real Estate Agents Do For Sellers?
Like the buyer’s agent, the seller’s agents have their own goals, one of which is doing whatever is best for the sellers and the obvious goal of getting the sellers home sold. So, what exactly does a seller’s agent do?
1. Prices your home correctly based on the current market conditions.
I cannot stress this enough, the most important job that a seller’s agent can do is pricing the home correctly. Again, I cannot stress it enough how important it is to price your home correctly at the beginning of your listing agreement with an agent. Many sellers think that if they price the home high, that they can just come back and reduce the listing price. While you can do that, the harsh reality is that by lowering the price of your home while it's listed can change the way buyers & Realtors® perceive the property.
Buyers will get the misconception that if you couldn’t sell your home at the original list price you set, that it means there is something is wrong with the home. More often than not, if you set the price too high initially you’ll have to reduce continually to sell it, and you’ll end up having to go lower and lower in price to get a buyer, which could end up with you having a lower price than if you would have had priced correctly in the beginning.
A local & knowledgeable real estate agent will carefully suggest a list price to be competitive in the current market based on similar home sales in your area. By having the expertise & knowledge of a great agent to price your home correctly is often worth more than the commission you will pay on the property.
2. Marketing your property like no other.
Marketing a home is the next most important skill a real estate agent offers sellers. Marketing a real estate listing requires a lot more than just listing the house in the MLS and putting a sign in the yard. You need to get the property prepared, take excellent photos, write a captivating marketing description of the home, let people know about the home through the MLS, which is where Realtors® input your home and start marketing the home to other Realtors®, adding your home to other real estate sites, where buyers are looking for homes, run social media advertisements, and good old fashion word of mouth, along with showing the home as well to potential buyers.
The best real estate agent will have an extensive marketing plan to get your home sold, which cannot be duplicated by anyone but another real estate professional.
3. Be Wary Of Agents With Gimmicks
Sadly, real estate agents are a dime a dozen and if you pick the wrong agent, they could lure you into one of these common practices where the real benefits of listing your home are solely with them and not you.
Two of the Biggest Gimmicks Right Now:
4. Keep In Communication With You.
Just like most sellers, you have obligations in life that probably occupy most of your time. However, just because you’re busy and on the go that doesn’t mean you don’t know what’s happening with the sales of your home.
A great real estate agent will always keep you up to date about what is going on with the sale of your home. A great agent will share all the feedback from showings, which will be a regular part of the process.
One of the best things about having a top real estate agent is that you can trust that they will keep you up to date as needed so that you are always in the loop and will be able to make informed decisions and not get overwhelmed
5. Make sure that buyers are qualified.
Anybody can say they want to buy a house. However, not everyone is qualified to buy your property. So, to find the buyer’s who are truly interested in your property, your agent needs to look for those that have been pre-approved for a mortgage.
The Pre-approval process is a little challenging at first, because you basically go through the entire process of getting a mortgage. However, once a buyer has received their pre-approval, it generally means that there shouldn’t be any problem with the buyer being able to purchase your home if nothing changes with their finances.
Again, your real estate agent should be there to make sure that pre-approved buyers are the only ones that are viewing your home & submitting offers, so you don’t waste your time with people that cannot buy the home.
6. Negotiating the best terms.
Top real estate agents want to get you the best terms for your home sale. After all, it’s what they are paid to do. Top real estate agents are skilled in negotiations because it’s something they do every day for multiple clients. When it’s time to go to the negotiating table, you’ll want a skilled negotiator there on your side. Your real estate agent is there to make sure that you’re getting the best possible terms for your home sale.
Like every seller, you want as much money as possible for the sale of your home. However, there might be other terms that are equally important, like a quick closing if you have to relocate for work. Your real estate agent will be familiar with your needs and will be there to ensure that those needs are met through the transaction.
7. Be Present For The Buyer’s Home Inspection
The home inspection will provide the hard facts about the state of your home, which are going to be the basis for negotiations moving forward. You’ll want to have your real estate agent there at the inspection who is representing your interests.
The reason you want your real estate agent there is, so they can follow along throughout the home inspection so that they know exactly what the state of your home is, and will be ready for the potential issues that the buyer may bring up when trying to negotiate repairs. Also, your agent will be able to push back on the buyer’s agent, if the buyer’s agent exaggerates the importance of the problems in the negotiations.
There are plenty of real estate agents who like to make excuses on why they will not attend the home inspection. If you someone who is working for you isn’t in there, it will be impossible to able to determine what is a real issue and what isn’t. More often then not, a home inspector’s report will overstate simple problems causing a home buyer to ask for everything under the sun.
8. Be There For The Home Appraisal.
During the sales process, there is another major event that can severely impact your home sale, and that’s the appraisal. You want to have your agent there when the appraiser comes out to view your home, as they may have questions about your home that need to be answered for them to give your home a proper valuation.
A good example is if the appraiser needs to know about any significant updates that you have made to your home, like having a septic tank replaced or a new roof, and so on, so if your real estate agent is there they can provide that information to them. Information like that can have a big impact on the final appraised value of your home.
9. Tie up and solve any remaining issues for the closing.
There are a lot of little details that must be taken care of to close on the sale of a home. Your REALTOR® should take care of all those last-minute loose ends so that you don’t have to worry about them or have to worry about a surprise in a way that could disrupt the closing.
10. Getting the best sales price for your home.
A real estate agent that knows the local real estate market where your home is located will know the value of your home and is the best asset you have on your side negotiating on your behalf. In real estate, there are no guarantees about how things will turn out in the end, but with the right real estate agent, you can stack the odds in your favor to get the best possible price.
Final thoughts on what real estate agents do for their Buyers & Sellers.
One of the best descriptions of a true real estate professional is a problem solver. The most highly skilled agents will work tirelessly for their buyers & sellers. What you see on HGTV, compared to the real version of what a real estate agent goes far beyond just showing a couple of beautiful homes and then collecting a commission check. The best real estate agents wear multiple hats during the transaction of a home sale and could also be described as the below terms.
Hopefully, after reading this article you have a better understanding of what a real estate agent does all day. Hopefully, you can better appreciate the work that is put in by those who are at the top of their game when it comes to real estate agents.
Experts are very optimistic that the housing market will rebound once the country emerges from stay-at-home orders. Let's connect and discuss how these insights may fuel your plans to buy or sell a home in 2020.