Most people don’t know the first thing about listing their home for sell. As a newbie to the real estate world it took me awhile to understand that agents do not just randomly decide what a house should be sold for. They have to run analysis of the houses in the same area to get comparable pricing and take into account the location itself. If it is a hotspot with bars and restaurants or a known unsavory neighborhood; that can really affect the price. For example, if a one bedroom house in Austin is close to downtown that is considered prime real estate and can sell for the same amount as a house in Cedar Park with five bedrooms. You know the old saying: “Location, Location, Location,” and it is definitely true. Let’s start from the beginning, you have decided to sell your home. You now have two options: you can do it yourself (which I honestly have no idea what that entails) or hire a professional who has done this a few times.
I would choose the professional personally (and yes this is shameless self-promotion of my company)! So, assuming you decided the latter, I wanted to give you an idea of how to choose the correct listing agent for your needs. These are points I have gathered from different articles, most of these will not be my original ideas. If they were my ideas, I would expect the agent to be available to me 24/7 and be my therapist through this stressful time! I am completely kidding, agents have business hours just like everyone else! I do have some ideas of what would make a great listing agent but at the same time, clients need to be realistic in their expectations. I have seen countless homes take longer to sell with no error on the agents’ part, sometimes the market can’t move fast enough or reasons my brain can’t understand because I am looking at these beautiful pictures but the house isn’t being bought. Okay, enough rambling let’s start the pointers of how to choose a listing agent!
Commission and Pricing
As stated in the opening paragraph, a lot goes into figuring out what a home will sell for and what the agent should be making commission wise from the sale. “Two of the biggest mistakes home sellers make when choosing a listing agent are selecting an agent solely based on the two things: the highest list price for your home and the lowest commission.” This quote was taken out of an article from “The Balance” and it has such a ring of truth in it. The basic commission of a real estate agent is 6% and then this is split with the other agent, so 3% of the selling price per agent. So you can have an agent try to reduce their portion of the commission while still giving the other agent 3%. And they can try to do this to help you out, if say they are a friend. However, if this is coupled with a very large price for the house the agent can still make a great pay check. And that is fine if that is actually what the house will sell for. If it isn’t comparable to the others in the neighborhood, it will not sell. Or take an exponentially long time. No one really wins in that instance. Below is another excerpt from “The Balance.”
“Pricing is an art. The best time for an offer is within the first 30 days on market. 21 days is ideal. If the home is priced right, you'll get an offer. If it's priced too high, you might not get any showings at all; buyers will shun your home and you'll eventually end up reducing the price, leaving buyers wondering what's wrong with your house.”
Another point is ask why the agent wants to have such a low percentage of commission? Are they trying to gain ground and clients in a competitive market or are they brand new and feel this is the only way to get clients? Well if they’re new I would give them the benefit of the doubt but it depends on your comfort level. But it is something to take into consideration. You are hiring this person and experience can make a huge difference.
You cannot discount the importance of marketing. You need to make sure your agent will market and try their hardest to sell your home. For example, we (admin assistants) have a system of sending out flyers with new listings to all the agents in Austin. At least the ones that haven’t opted out. To take into consideration, many people don’t like clutter in their inboxes so they will opt out of informative emails but that is just the way business works. But your agent will try and circumvent that with Facebook Ads, Instagram and Open Houses, and other creative outlets. There are numerous ways to market homes and asking the agent what their plan is can tell you a lot about them and if you should hire them or not. HGTV makes a great point “The practitioner should be able to talk about what kinds of people are likely buyers and how he will reach out to those specific people.” See if your agent mentions that or ask them outright.
Trust your gut as a consumer and feel out what is right for you. And remember some agents will just mesh well with you better than others. Keep in mind you will be working closely with this person for months (hopefully not but be realistic!) and you want to get along. If three agents come to you and they are all great with excellent plans, go with the agent you feel the best about. Yes, statistics are extremely important and need to be looked over meticulously. Then take into account the human factor and pick an agent you feel works best with you.
I am also going to link a great article about 9 Red Flags but again these are suggestions do not take anything for fact and do your research!
Also I have a ton of great listing agents! 512-483-6000!