Corporations employ investment bankers to help them acquire other companies.
Bankers are experts in valuing companies and negotiations. Ultimately, the board of the acquiring company makes the final decision about what price to pay, but it is the bankers who do all the legwork.
Real estate is no different.
A smart homeowner will take the time to interview and vet several real estate agents before selecting one to represent him or her in a sale.
When I am interviewing a real estate agent I evaluate this person on seven criteria.
First, the agent puts the client first. I can tell by the questions an agent asks me whether he or she is more interested in my needs or the commission. An agent who sincerely takes the time to learn about my situation and coach me through the selling process without ever mentioning the commission is more likely to win my business.
Second, in the process of discussing my needs, I can detect whether the person is knowledgeable about the market or not. I look for an agent who can go beyond the headline numbers and suggest ways that we can benefit from the current market situation, no matter whether the market is up or down. For example, in today’s buyer market, I would evaluate the agent on the person’s ability to sell homes in a down market and fetch the right price.
Third, the agent must be an expert in the area so that he or she can properly market and position my home. This means the agent must know my property type, all the amenities (i.e., schools, transportation, shopping, parks, etc.), and, most importantly, be well versed in future development in the area that will give the buyer confidence that the home will continue to appreciate in value.
Fourth, I ask the agent what similar homes in the project or neighborhood are available for sale. I then ask how the agent plans to differentiate my home from those competing listings.
Fifth, I evaluate the agent on his or her ability to price my home. I expect the agent to employ the latest in information and technology and walk me through the Comparable Market Analysis (CMA).
Sixth, we have a thorough discussion on how the agent plans to market and position my home. What attributes will he or she emphasize in the listing and promotional material? Where will the agent promote my home? In today’s digital age, I expect my agent to market my home on multiple national listing portals, agent-only listing channels like SRX Circles, agent-only mobile applications like Agent Connect, and social networking.
Seventh, when I am interviewing the agent , I evaluate his or her negotiation skills. To be a good real estate negotiator, there are six components one must master: the client, the market, the other side of the negotiation, the facts, knowledge of market, and negotiation tactics.
While I cannot access the agent’s mastery of all six components in one interview, I can get a feel for the agent’s potential as a negotiator. If he or she asks good questions about my needs and demonstrates strong knowledge of the market, pricing, and the competition, I can be confident that this person is a good negotiator.
As a homeowner, you might be tempted to save money by trying to sell your home without an agent.
I strongly advise against this temptation.
A professional agent lives the real estate market 24/7 and can access the other side of the negotiation via the buyer’s agent. As a homeowner, you are the principal in the deal. Experienced principals know it is pennywise pound foolish to negotiate on one’s behalf.
Even as co-founder of the SRX Property, I always employ a real estate agent. The value that my agents have delivered to me have more than paid for their commissions.