Five Key Questions To Ask Before Hiring A Real Estate Agent To Sell Your Property
Having been in the real estate business since 1994, I've been interviewed by lots and lots of people about my credentials as an agent. Sometimes I thought the questions were appropriate and things they rightly should know. Sometimes I thought the questions really did not shed much light on my background or how I could help them.
There are probably a lot of questions a seller could ask a real estate agent, but essentially I think there are only five key things that need to be known. In no particular order, here are the questions ...
1. How long have you been in the real estate business in this area? Length of time in business tells you something about the success rate of the agent. Agents get paid by commission only. No salaries. In order to remain in the business, they need be successful in selling the properties they list. If they are not successful and not earning any commissions, they can't afford to stay in the real estate business for very long. (Now, if you run across an agent who is being supported by a spouse, an inheritance, a trust fund or has some other means of income, this could throw you off. But for the most part, agents have to be making a living in order to stay in the real estate business.) You also want to know if they've been in your local area for a long time, or if they are a newcomer. Generally, someone who has been in the area for a long time knows more about the area than someone who just moved here, and that could prove beneficial to you.
2. Are you a member of the local Board of Real Estate? If the agent is, you get a great advantage. First of all, that agent has access to the local Multiple Listing Service (MLS). If you're a seller, your property gets put on the MLS computer and then on other important web sites as well, like Realtor.com. This means any member-agent has information about your property and can sell it to any buyer with whom he is currently working. Plus your agent will have access to loads of training and educational programs available only to Board members. If the agent is not a member, none of these things are available and you will likely suffer the consequences.
3. Will you give me a written marketing plan to sell my house? Marketing is the key to successful selling in a down market like we have today. If your agent can not or will not present to you a comprehensive written marketing plan that outlines all the steps he will take to sell your house, hire somebody else. In fact, the marketing plan should be the primary way that you choose between agents and real estate companies. Frankly, I think you should call on three different real estate brokerages and interview three different agents, the determining factor being the marketing program. The more complete it is, the more likely you'll get your property sold for the highest price. (Of course, it is also important if you like the agent and feel like he or she is someone you can work with.)
4. In the last two to three years, what has been your ratio of listings to sales? This is a way to directly measure success. When the market was hot, everything that got listed generally got sold. But events in the last 18 months or so have changed that. Still, this ratio is a good indicator of success. If the numbers are very low, you might want to look for another agent to represent you. If you are talking to a very experienced agent who has been in the business for 10 years or more, they may have no idea what their overall ratio is because we just didn't keep those kind of stats way-back-when and it would be virtually impossible to reconstruct somebody's entire career. But events in the last three years should be easy enough to track, so ask. If they don't know the answer, ask them to get the data and call you back.
5. What percentage of your listings do you sell yourself? You do not want to work with an agent who sells 80 or 90 or 95 precent of his listings himself. What this generally means is that other real estate agents in town are not willing to work with him and won't sell his listings. So, he better sell a very high percentage of listings himself. He has to! Nobody else will work with him. Instead, you want an agent who sells about 10 to 15 percent of his own listings, and the rest are sold by other agents. This means other agents are willing to work with him to sell the listing, and clearly the more agents who will work to sell your house the better for you. The national average varies from year to year, but it appears that an agent sells his own listing about 1 time in 11, or about 9 percent of the time. Don't be fooled by people who say they sell huge percentages of their own listings. That's not really a good thing. (Now, if you are selling a luxury home costing millions of dollars, you may want an agent who sells a higher than average percentage of their luxury listings due to the nature of these kinds of sales. Luxury homes are often sold by the listing agent to someone to whom the agent is personally acquainted, so the percentages in this category are often higher.)
My feeling is that if you get the right answers to these five questions, you are probably dealing with a pretty darn good real estate agent. If you don't like the answers, talk to somebody else.
If you would like more information on real estate in the Tampa Bay area, visit my website at www.TheStPeteRealEstateSite.com.
There are probably a lot of questions a seller could ask a real estate agent, but essentially I think there are only five key things that need to be known. In no particular order, here are the questions ...
1. How long have you been in the real estate business in this area? Length of time in business tells you something about the success rate of the agent. Agents get paid by commission only. No salaries. In order to remain in the business, they need be successful in selling the properties they list. If they are not successful and not earning any commissions, they can't afford to stay in the real estate business for very long. (Now, if you run across an agent who is being supported by a spouse, an inheritance, a trust fund or has some other means of income, this could throw you off. But for the most part, agents have to be making a living in order to stay in the real estate business.) You also want to know if they've been in your local area for a long time, or if they are a newcomer. Generally, someone who has been in the area for a long time knows more about the area than someone who just moved here, and that could prove beneficial to you.
2. Are you a member of the local Board of Real Estate? If the agent is, you get a great advantage. First of all, that agent has access to the local Multiple Listing Service (MLS). If you're a seller, your property gets put on the MLS computer and then on other important web sites as well, like Realtor.com. This means any member-agent has information about your property and can sell it to any buyer with whom he is currently working. Plus your agent will have access to loads of training and educational programs available only to Board members. If the agent is not a member, none of these things are available and you will likely suffer the consequences.
3. Will you give me a written marketing plan to sell my house? Marketing is the key to successful selling in a down market like we have today. If your agent can not or will not present to you a comprehensive written marketing plan that outlines all the steps he will take to sell your house, hire somebody else. In fact, the marketing plan should be the primary way that you choose between agents and real estate companies. Frankly, I think you should call on three different real estate brokerages and interview three different agents, the determining factor being the marketing program. The more complete it is, the more likely you'll get your property sold for the highest price. (Of course, it is also important if you like the agent and feel like he or she is someone you can work with.)
4. In the last two to three years, what has been your ratio of listings to sales? This is a way to directly measure success. When the market was hot, everything that got listed generally got sold. But events in the last 18 months or so have changed that. Still, this ratio is a good indicator of success. If the numbers are very low, you might want to look for another agent to represent you. If you are talking to a very experienced agent who has been in the business for 10 years or more, they may have no idea what their overall ratio is because we just didn't keep those kind of stats way-back-when and it would be virtually impossible to reconstruct somebody's entire career. But events in the last three years should be easy enough to track, so ask. If they don't know the answer, ask them to get the data and call you back.
5. What percentage of your listings do you sell yourself? You do not want to work with an agent who sells 80 or 90 or 95 precent of his listings himself. What this generally means is that other real estate agents in town are not willing to work with him and won't sell his listings. So, he better sell a very high percentage of listings himself. He has to! Nobody else will work with him. Instead, you want an agent who sells about 10 to 15 percent of his own listings, and the rest are sold by other agents. This means other agents are willing to work with him to sell the listing, and clearly the more agents who will work to sell your house the better for you. The national average varies from year to year, but it appears that an agent sells his own listing about 1 time in 11, or about 9 percent of the time. Don't be fooled by people who say they sell huge percentages of their own listings. That's not really a good thing. (Now, if you are selling a luxury home costing millions of dollars, you may want an agent who sells a higher than average percentage of their luxury listings due to the nature of these kinds of sales. Luxury homes are often sold by the listing agent to someone to whom the agent is personally acquainted, so the percentages in this category are often higher.)
My feeling is that if you get the right answers to these five questions, you are probably dealing with a pretty darn good real estate agent. If you don't like the answers, talk to somebody else.
If you would like more information on real estate in the Tampa Bay area, visit my website at www.TheStPeteRealEstateSite.com.
-30-
posted by Terry Ward at 4:03 AM
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