by Dan Krell
Home buying and selling without an agent is not for everyone. The value of hiring a real estate agent.
A somewhat prophetic Howard Schneider proclaimed in a 1995 article “For Better or for Worse” (published in Mortgage Banking; 56(1), 110) that a combination of technology and industry consolidation would drastically change the real estate landscape by the end of the 1990’s. He discussed technology changing the relationship between Realtors® and consumers such that through the development of technology, home sellers and buyers would be able to interact without the use of a real estate agent. He quoted John Moore, then president and CEO of Genesis Relocation Services, “If you can get the word out about your property efficiently to the mass market, you can avoid paying the full brokerage commission…” and “…within five years, most homes will be able to see listings around the country on interactive T.V.”
What Schneider described did happen – it was the internet. The growth of the internet during the first decade of the 21st century allowed home buyers and sellers to interact with each other like no other time. The technology was a boon for those who decided to go it alone.
Of course the internet was only a piece to the larger puzzle of the early 2000’s. It seems that for a very brief time, just placing a sign in the yard was enough to spread the word of your home sale; the price, financing, and closing all seemed to be a “no-brainer.” But five years after the housing boom, it’s evident that not everyone can sell real estate “by owner.”
One of the top reasons for selling or buying a home without a real estate agent is the perception of saving money. People who decide to sell without an agent don’t see the value of hiring an agent; while some buyers who decide to buy without an agent believe they can reduce their sale price by the commission amount.
Although hiring an agent may not be a god fit for some, many value what an agent can bring to the transaction. Real estate agents are housing-market experts; besides knowing neighborhood trends, they can provide detailed market analyses to assist in formulating a listing or sale price for home sellers or buyers. Agents facilitate offers, transactions, and negotiation. They are up to date on legislation affecting home buyers and sellers; agents know the seller’s/buyer’s obligations, including compulsory disclosures and forms. And of course, there is the time aspect (how much is your time worth?).
Talented real estate agents are sales and marketing specialists. These agents know how to interpret home sale data to determine a price, and the best times to list/buy your home. Additionally, they know how to prepare and present your home to prospective home buyers and promote it to grab home buyers’ attention.
Getting back to Schneider’s article…he concluded that regardless of technological advances and the inclination toward mergers to an increasingly centralized industry with few big players; it’s ultimately about nearby professionals who have the knowledge of the local market, who can personally assist you through your transaction. Personal attention cannot be under-emphasized, especially when the transaction is demanding or emotionally charged.
Are you better off without a real estate agent? You might think that technology has made it easier for you to go it alone; but, if you want a relatively smooth transaction with little drama – hire a professional.
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This article is not intended to provide nor should it be relied upon for legal and financial advice. This article was originally published in the Montgomery County Sentinel the week of January 21, 2013. Using this article without permission is a violation of copyright laws. Copyright © 2013 Dan Krell.