When can we meet?
The first thing you want to know about your Realtor® is how they communicate and what their availability is. Did they answer the phone on the first ring? Did their assistant answer the call? Did you have to leave a message and did they return the call promptly? Will they jump in the car and meet you in 20 minutes to show you a property you saw online? None of these are necessarily good or bad, but you want to start paying attention from the first interactions and it is a good idea to find out how they work and how they communicate.
If an agent is too available or too anxious to get going that might be a cause for concern that they don’t have enough going on or don’t have a good process. Alternatively, if an agent doesn’t have time to set an appointment with you in the next couple of days – there better be a pretty good reason!
You want to hire a professional who runs their business like a business. They should follow a schedule, be able to work around your availability, and have a process for when and where they meet with buyers and sellers so they can answer the rest of your questions. Such as:
Tell me about your brokerage…
This one isn’t a common “make sure you ask…” question, but it should be. The brokerage an agent works for should be important. There are all kinds of different brokerages out there from one-man operations to franchises to multi-state operations to boutiques and everything in between. Any of those might be a fit for you and your agent – and you should know why.
Does your Realtor® have authority to make all the decisions involved in the process, or do they need to check with their broker on certain things? You don’t want to get held up waiting or having your agent putting things on pause while they check with their broker on little issues. This can also be a way agents deflect or hide behind issues like “my broker won’t let me charge less commission”. Does their brokerage have influence or participate in the community? Does the brokerage have a good reputation among the other agents in the area that your agent will be working with? Also, finding out how involved your agent is with the company that they work for will give you a good idea of their experience, value, and influence.
Ultimately, it helps you to have a good support system behind your Realtor® with additional checks and balances, processes, procedures, and support. This is a team sport and your agent is the quarterback, but there should also be a team owner, general manager, and coach.
What’s your record?
And any good team should have a winning record. Can you see a list of all the homes they have sold or the people they have helped? Even if it is just one person, that might be enough to convince you that this will be a phenomenal experience. However, you might want to shy away from the hand-selected 2-3 references they have ready to go. Do your own research. Look them up online and see if they have a good presence and reviews. If your Realtor® doesn’t have any online presence in 2018 – well, I just think it’s important that you notice that.
Ideally, you want someone with a proven track record that shows a consistent pattern of satisfied clients. This will not only increase the chances of having a good experience, but will also increase the chances the agent has strong relationships in the community with other agents. Those relationships are going to be key in getting the deal done when it matters. You also would ideally like to be able to call anyone they have closed a deal with and see how the experience was, not just their cousin Vinny.
How many clients have they been unsuccessful with? Any good agent is going to have a listing that expired, an unrealistic seller they got out of business with, and a few buyers that didn’t end up buying. It is a good idea to hear those stories and understand what went wrong to make sure your agent is upfront, honest, and willing to explain to you the potential pitfalls that could happen along the way.
Are you a listing agent or a buyers agent?
While it is true that some agents specialize in one section of the business, whether it be buyers, sellers, negotiation, operations, transaction coordination, etc., the agent you are meeting with should be able to explain how you will be served in all facets. Most sellers are going to be buying somewhere. Most buyers will eventually become a seller. The agent you want to work with should ideally have experience with both buyers and sellers to understand what the people on the other side of your transaction are going through, thinking about, and negotiating towards.
When an agent is newer or has less clients, they tend to work with more buyers than sellers. When an agent has a more established business, that ratio tends to even out. The more repeat and referral business they generate, the more likely they are to have a balanced ratio as well. That referral and repeat business and the percentage of business that is generated by word of mouth is also key in figuring out if other people put their trust and confidence in the agent you are about to hire.
This is also a good time to find out what their list price to sales price ratio is. From a sellers perspective, you want it to be as close to 100% or higher as possible and from a buyers perspective you want it to be as far from 100% as possible. However, recent market conditions play a huge role in this. So does the properties that their clients ended up selecting. Just because the current local average is 99% of asking price doesn’t mean that will end up being the case for you. If a property you like has been sitting on the market overpriced, your agent might negotiate a contract at 90% or less of asking price. If your dream home comes on the market strategically underpriced, you might get a “deal” by paying 2-3% (or more!) over asking.
What makes you the local expert?
You want to hire the local expert right? Maybe not. I guess it all depends on how you determine that title. You certainly want to hire an expert. You want to hire an expert at marketing. You want to hire an expert negotiator. Real estate is definitely a local business and you need someone who understands the area.
What you might want to avoid is hiring the agent that has been littering your doorstep with market updates that were printed at home the last 10 years. You might want to avoid that agent whose same headshot has graced the magnet on your refrigerator or notepad your kids doodle on since you bought your home 20 years ago. (get a new headshot already!)
Why? While not all “farmers” are to be avoided, a lot of times you will be hiring an agent that is hyper-locally focused which might cause them to be a little bit of an ostrich with their head in the sand when it comes to the market in general. Additionally, you are probably hiring your competition. If an agent has several listings in the neighborhood you live in, they will likely be taking buyers from your home over to your competition because they get paid regardless of which property they sell first.
What about a local-expert buyers agent? I suppose if you are dead-set on one neighborhood or community that would work, but typically buyers want to find the home and community that best fits their needs. A great agent will be able to make suggestions that might be outside of what you had in mind. An up and coming area, a new development, a better value or so many other options might be somewhere you’d never thought of or knew about. Get an agent that will understand who you are and what you’re looking for and then prescribe the best options for your consideration.
What about price point? With the exception of luxury and ultra-luxury, your agent should be able to serve any price point from entry-level condos to that duplex you were thinking about investing in. You should also feel the same level of respect, service, and care regardless of how big the commission check is. A great agent treats everyone to a five-star, world-class, blue-ribbon customer experience. Their sales record, testimonials, and reviews should also reflect this track record. If your purchase/sale is going to be in the top 10% or 1% of the market – definitely hone in on their experience and relationships in the luxury market. They should know who the players are and how that world operates and most don’t so be wary.
Show me the systems!
As mentioned, a great agent should run their business like a business. Systems are how your agent will ensure everyone has that five star customer experience. The only way these systems can be followed every time is to have them written down and documented. They should be able to easily show you the different checklists and processes that they work off of and this should give you an outline of the experience you are about to go through.
This should begin with their process for answering the phone, setting the first appointment, going over your needs, marketing plan, showing houses, negotiation, communicating with their clients AND the other agents, contracts and disclosures, vendors, and what happens when something goes wrong. There are well over 100 items that need to be handled on every real estate transaction and most can be anticipated and thought through strategically ahead of time.
OK – that sounds like a lot of work. Are you doing this all by yourself?
Can you receive a great experience with a solo-agent? Sure. Sometimes you can receive a much superior experience, but the truth is that no one succeeds alone. Even a phenomenal “solo-agent” has partners involved along the way such as great vendors, maybe a transaction coordinator, their broker/office staff, and other affiliates.
You want an agent who can articulate the different players. You’re hiring the quarterback and they need to be able to explain the entire roster. What most people have discovered is that having people who specialize in specific roles throughout the process leads to the best experience – not just in real estate but in most businesses. Would you be comfortable going to the Dr. and having her check you in, take your blood pressure, prep you for surgery, and perform the surgery and then handle your billing? Probably not. Same thing if you showed up to a fancy restaurant and the chef parked your car and seated you before preparing your meal.
The truth is there is a TON that goes on behind the scenes in real estate and a lot of it you shouldn’t need to worry about, think about, or even know about. Someone needs to own it though. Someone needs to make sure it is getting done before it is due. Someone needs to double check the work and make sure nothing falls through the cracks. Your agent should be able to tell you upfront who you are going to work with at each stage of the process and how you will be communicated with. The more streamlined this seems the better. The truth is this can get really messy with too few people AND too many people. You should have a primary point of contact at any time and you should always feel like you know what is going to happen next.
Are you proactive?
You want to hire an agent that just sits around and waits for the transaction to happen right? That five-star marketing plan is all about the sign in the yard with the flyer box – no? Oh you actually want to hire an agent that is willing to get out there and make things happen for you. Got it.
See – there’s a reason most people feel like real estate agents are overpaid. That’s why you’re still reading this. Because there’s got to be a better way. If you are buying a property, you want an agent that is not only going to show you the properties listed on the mls. You remember – the one’s you emailed them that you found the night before on your favorite real estate search app. And honestly, the home you buy might be the one you found yourself – especially if you’re the type to spend five hours a day looking at every new listing that pops up. A great agent will also be out networking, looking for off-market opportunities, researching properties that didn’t sell that might be a fit, going door-to-door for sellers who might not be on the market yet, and sending letters to specific properties that are a perfect fit for you.
A great listing agent does the same thing in reverse. They proactively market your property through networking, social media, advertising (not in the newspaper – that’s just to make you feel good about your house), telling all the neighbors, and helping you make sure your property is presented to as many buyers as possible in the best possible light. They are also proactive about anticipating problems that might go wrong, buyer objections, and protecting you from potential liability.
How can you save me time and money?
The world moves pretty fast these days and there is a huge battle for time. That’s why companies like stitch-fix, doordash, ubereats, postmates, taskrabbit, and amazon prime exist. While it might be possible for an agent to pick out the property for you and have you love it, you’re probably going to need to be a little bit involved in the process.
A great agent will be able to save you time and money through their processes and procedures. They will want to do an in-depth analysis (conversation) about what you are looking for. What do you actually need vs what do you want? What is your budget – and what is your risk tolerance? What are all your available lending options? Oh and so much more. This will allow you to save time and narrow your focus systematically rather than running around with no gameplan.
Negotiation will also play a key role but as mentioned above that is on a case by case basis depending on how the property is positioned in the market. Relationships with other agents will be critical in putting a deal together with favorable terms and the best price. Also, relationships with vendors will help you find the best deals on repairs, improvements, furnishings, and appliances.
A great agent that can save you time AND money along the way will pay for themselves and won’t cost you anything.
Is this just about the money? What happens after we close?
When you hire a great agent you are going to be in communication a lot. By the time you get across the finish line you should be friends and know each other pretty well. And then they just ghost you? No call? No text? No fridge magnet? WTF? I knew they just wanted me for my commission check.
No – a great agent understands the power of a strong relationship and knows that building an amazing real estate business isn’t transactional. They will have another system for what happens for their VIP clients like you. They’ll check on you a couple weeks later to see if you need a handyman. They’ll send you your closing statement at tax time because they know you need it and you don’t remember you ever even got one. Your housewarming party will be included along with monthly giveaways, client appreciation events, and a sense of community. These are the types of activities you can expect from an agent building a great real estate business based on repeat and referral clients.
How are you involved in the community? What charities or causes do you support?
Because real estate is such a local business, it is important that the agent you choose be involved in their local community. Do they have a specific charity they support or a cause that a portion of their commissions is donated to? Do they do anything hands-on to actually get involved in order to make the area a better place to live? What about mentorship – are they bringing anyone up with them along the way?
The best agents find ways to give back, mentor, get involved, and make a difference in the lives of the people in the communities they serve. Real estate is a service business and rarely do people move “for fun”. They typically move at a critical time in their life i.e. divorce, job relocation, marriage, having more kids, death in the family, loss of job, or a promotion. A great way to find out if an agent is going to really care is to see how they serve others and give back.
Sold! What’s it gonna cost me?
Real estate commissions are completely negotiable. When it comes to hiring a great real estate agent – you get what you pay for. Great agents can turn down business and have standards by which they run their business. Hiring an agent that doesn’t have standards on what they charge and how they work probably isn’t running a very good business. They probably aren’t a very good negotiator either. The trite line you might hear when discussing this with your agent is “if that other agent was willing to give away their money so easily, what will they do when it’s your money on the line” – which is true. It’s just that not really the story.
The real story is most people value great service. It’s why luxury brands exist. It’s why people are willing to pay a little more to eat at an amazing restaurant for their anniversary. In order to deliver all the things you are going to want and need from a great Realtor® they will need to charge a little more to cover those expenses.
If they really have a great business model, they might even have a flexible commission program. Depending on what you value and the experience you are looking for – or under certain circumstances that can’t be determined ahead of time – your agent might be willing to charge variable commission rates. They also might be able to work with you on commission if you purchase multiple properties. They’ll probably also be willing to sign an agreement with you that you can cancel anytime with no risk for any reason.
When you’re ready to hire a great agent, call or text Etherton Real Estate at 1(805) 617- 0774