by Dan Krell © 2010
Buying and selling a home can be one of the most expensive and complex transactions you may undertake in your lifetime. So if you plan to hire a real estate agent to assist you, conventional wisdom dictates that you should interview several. However The National Association of Realtors 2009 Profile of Home Buyers and Sellers (NAR 2009) tells a different story. The profile reveals that the majority of home buyers and sellers surveyed (66% of buyers and 64% of sellers) indicated they hired the agent they first encountered.
Although the logic may seem counter intuitive, the means by which home buyers and sellers encounter their agents may provide an explanation. Both home buyers and sellers reported that the top means of finding their real estate agent was through a referral from a friend or family member. Of those surveyed, 44% of home buyers and 40% of home sellers indicated they relied on someone else’s judgment for their choice of real estate agent; first time home buyers were most reliant on their friends’ and family members’ referrals.
Repeat business was the second most frequent way indicated in choosing a real estate agent; meaning that the home buyer and/or seller hired the agent that assisted them in the past. Oh, the internet was also indicated as a way of finding a real estate agent; however it was not one of the top means. However, more home buyers (10%) indicated they found their agent on the internet compared to sellers (3%).
Regardless of how you find your real estate agent, it is probably a good idea to find out more about them before they list or sell your home. A conversation about their experience, knowledge, and expertise is probably a good way to start. Additionally, knowledge about the local market is extremely important these days as market trends have become hyper-local. Two recent conversations with home owners revealed the importance of understanding hyper-local real estate trends; both discussed how the agent they wanted to hire did not have an understanding of the hyper-local impact which resulted in under-pricing or over-pricing their homes.
Because of the increase in number of transactions requiring specialized knowledge (such as short sales, 1031 exchanges, etc), it is probably a good idea to find out if the agent has the experience (or certification) if your purchase or sale falls in this category.
Although choosing an agent should transcend the “big name” myth, some people still get caught up in the name game. It has been many years since residential real estate has been proprietary, brokers now cooperate with each other to sell homes. Home buyers typically search for homes by characteristics, rather than searching for homes sold by individual brokers. Ultimately, your home purchase or sale falls upon the experience and skill of the agent you hire.
If you are considering hiring a real estate team to handle your sale, make sure there is one agent you can call as your point of contact. Questioning the point of contact about their experience and knowledge is also a good idea.
Asking friends and family for referrals as well as calling the agent you previously worked with is a good way to find a real estate agent. However, vetting out potential issues can be achieved by asking the right questions before you hire them.
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 August 23, 2010. Using this article without permission is a violation of copyright laws. Copyright © 2010 Dan Krell.