Is It Really Necessary To Utilize A Realtor?
Posted by The Atlantic Real Estate Team on Tuesday, August 31st, 2010 at 6:50pm.Of course we are going to answer that question with a yes but also want to detail, based on a number of our professional experiences, exactly why it could be quite costly to you not to employ the right Realtor. The main reason people consider not using a Realtor has to do with the commission fees. While doing the work yourself can save you that cost, buying or selling a home is a major financial and emotional undertaking that involves many intricacies with a number of potential situations you may not have thought of outlined below that can result in a different kind of cost.
Immense Access / Considerable Convenience
Our full-time job is to act as a liaison between buyers and sellers. We have immediate access to all other properties listed by agents and also know what needs to be done to get a deal together. For example, if you are looking to buy a home, we will identify the homes that meet your criteria, get in touch with the listing agents to make appointments to show you the homes, and gather the background information on the properties. If you are buying on your own, you will have to play this telephone tag yourself. This could be especially difficult if you are shopping for homes that are for sale by owner or if the listing agent wants to ‘pre-qualify’ you prior to showing you the listing you want to see.
If you are looking to sell your home yourself, you will have to solicit calls from interested parties, answer questions, make appointments, and show your home to someone walking in off the street. Keep in mind that serious buyers are likely to move on if you tend to be busy or don't respond quickly enough. You may also find yourself making an appointment and rushing home, only to find that no one shows up.
Negotiating is Complicated / Market Knowledge is Power
Some people don't like the idea of conducting a real estate transaction through a Realtor because they believe direct negotiation between buyers and sellers is more transparent and allows the parties to better look after their own interests. This may hold true in the somewhat rare occasion that both the buyer and seller are able to get along and both parties are willing to see the situation without bias. However, that is not generally the norm as removing perspective bias is extremely hard to do without a wealth of current market knowledge and just simply impossible for some people.
What if the reason you think a home is not in line with market value has to do with the seller’s décor? If you are working with an agent, you can not only express your contempt for the general appearance as well as discuss the cost of cosmetically upgrading the home without insulting the owner. It could very well be that the décor has to do with religion, is a result of precious family heirlooms, or simply just personal style. As your Realtor, we could convey that to the listing agent who would then be aware of how to handle the discussion with the seller without making it personal. If you weren’t working with a Realtor, your ‘transparent’ reason to inform the seller that the home, and therefore your offer, is below market value could kill the deal pretty quickly.
As Realtors, we sometimes must play the role of ‘bad guy’ in a transaction, preventing the bad blood between a buyer and seller that can cause a deal to go south. Don’t doubt for a minute that sellers can reject a potential buyer's offer for any reason, including that they don’t care for the buyer’s attitude, don’t think the buyer will take care of the house they loved for so many years, or a million other personal reasons, some of which could even be unethical. As your Realtor, we can help by speaking for you in tough transactions and keep them from getting too personal. This can put you in a better position to get the house you want. The same is true for a seller, who can benefit from a hard-nosed Realtor who will represent his or her interests without turning off potential buyers who want to make negative comments about your home or the price of it.
Contracts Can Be Quite Complex, Especially in this Market
If you decide to buy or sell a home, the contract is there to protect you and ensure that you are able to back out of a deal if certain conditions are not met. As an example, if you plan to buy a home with a mortgage but you fail to make financing one of the conditions of the sale and then the lender will not approve the mortgage (even if you were pre-qualified - and this can happen for an infinite amount of reasons not even having to do with you), you can lose your escrow deposit on the home and could even be sued by the seller for failing to fulfill your end of the contract. As your Realtor, we would provide our expertise based on your personal situation as well as the circumstances of the home you want to sell or purchase and write in all applicable contingencies that could ultimately protect you.
Realtors Are Held ACCOUNTABLE to a Code of Ethics
Due to the fact that local real estate agents are licensed under the Florida Department of Business & Professional Regulation, there are far more repercussions if they misrepresent or act unethically than for a private buyer or seller. A licensee is presumed to be working as a transaction broker unless they have entered into a different specific brokerage relationship with a client. Transaction broker duties include dealing honestly and fairly, accounting for all funds, limited confidentiality, and using skill, care, and diligence in a transaction. Additionally, a major aspect of the Atlantic Real Estate Team’s business is referrals and repeat business to build the kind of client base we have to be as successful as we are. Doing what is best for and having a good relationship with our clients resulting in referrals and repeat business is far more important to us than any one individual sale.
When a buyer and seller work together directly, they can and should seek legal counsel. However, because each is expected to act in his or her best interest, there isn't much you can do if you find out later that you have been misled about multiple offers or the home's condition. The cost of having a lawyer on retainer any time you want to talk about potentially buying or selling a house could also far exceed an agent's commissions by the time the transaction is complete.
‘For Sale By Owner’ DoES NOT Always Negate Commission
Many people avoid using a real estate agent in order to save money, but keep in mind that it is unlikely that both the buyer and seller will reap the benefits of not having to pay commissions. For example, if an agent has a potential buyer that is interested in a home for sale, they are most likely not going to present the home to the buyer until the seller agrees to pay their portion of the commission. So the only thing the seller just saved on was the cost of a Realtor marketing their home, getting it sold faster, and most importantly, representing their side in a deal with an agent on the other side representing the buyer and writing the contract.
If you are the buyer and purchase a home for sale by owner, keep in mind the seller most likely priced it based on the sale prices of other comparable properties in the area. However, many of those properties were sold with the help of an agent, so commission was a part of the total equation. As the buyer, you essentially just contributed even more to the seller than market value sales price. Basically, unless buyer and seller agree to split the savings, they can't both save on commission fees.
IT IS beneficIAL to YOU TO utilize a Realtor
The bottom line is that the home buying and selling process is not as simple as many people assume. And when you get into a difficult situation, it can really pay to have a professional with current market knowledge, real estate expertise, and experience with all the situations that can come about on your side working for you. Contact us today so that we can help you with one of the biggest financial transactions of your lifetime!
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