Do I need a real estate agent to buy or sell a house?

What do real estate agents actually do?

The answer, of course, is no. You can make it through the process of buying or selling a home without an agent, and some people do. But even savvy, longtime homeowners and real estate investors use real estate agents. Like any longstanding profession, agents exist because they provide value.

Bringing a real estate agent in will cost the seller ~6% of the sale price, but property owners still end up money ahead for having partnered with a reliable agent. An experienced professional will save you loads of time and keep you free to maintain your income at your day job. They’ll connect the ideal buyer to the ideal home, and sooner. Finally, they’ll make sure you get a fair price, whether you’re buying or selling.

Take home buying more seriously than you would any other investment

For most people, real estate transactions are the biggest ones we’ll ever make. The numbers tell that story. Your car, for example, will be a fraction of the price of your home. A 5% miscalculation on a $20K car will cost you $1,000. But 5% on a 700K home (roughly the average sale in the current Greater Seattle market) will cost you 35k, enough to buy the aforementioned vehicle with 15K leftover. You probably won’t miscalculate by 5%. But you might, and even 2% is still 14K.

But let’s look past the numbers. A home is the most important thing you own, and much of its value to you cannot be quantified. Getting in the best one you can get for your means is nothing to be taken lightly. You’ll experience its benefits (or frustrations) daily for years. Meeting all your needs is critical when making a commitment to the tune of hundreds of thousands of USD --- or a 15 to 30 year financing arrangement. Understanding your needs and addressing them is what an effective real estate agent specializes in.

Finally, your home is one of the only things you own that is truly a financial asset. If you play it right, you’ll come out money ahead. If you don’t, you might not even cover inflation. Playing it right, of course, starts with maximizing what you can get for your means.

How a real estate agent can help you meet your needs

To sell a home, you’ll need to:

---market your home, including listing it, describing its best features, staging the home, taking photos

---pinpoint the right listing price without overselling or underselling your home

---schedule times to show the house and arrange for somebody to be there

---assess buyer’s financial means to make sure they’re qualified

---negotiate the sale price

---get through all the paperwork and navigate the escrow process On the flip side, if you’re buying a home, you’ll need to:

---establish your financial means and secure financing

---assess your needs and pinpoint your top dollar

---Screen all the listings in the area, and determine which ones best suit your needs

---contact the sellers of viable properties and schedule times to view them

---view the home and meet the seller

---negotiate

---get through all the paperwork and navigate the escrow process

A reliable agent will do almost all of the work above for you. They’ll do it in less time, and with excellent results. You’ll be reassured that you’re doing the best you can in every department. And they’ll walk you through every step, answering every question you have, so that you become familiar with the process.

Can I trust a real estate agent to get me the best deal?

To delve into this question, you need to understand how agents makes their money, and what their motives are. Like any sales profession, real estate agents are paid on a commission of the sale. This commission comes out of the final sale price of the home, and if there are two agents involved, they split it --- it doesn’t increase the commission percentage.

Commission based pay is necessary, because connecting buyers to sellers requires accountability, resourcefulness, and motivation. Somebody with a guaranteed salary is not likely to embrace the work involved in closing sales: slogging through all the properties that don’t match to find the ones that do, contacting countless strangers, handling tough negotiations, marketing your home, constantly studying their market, adapting to changes, and competing with other buyer/sellers.

Agents do all the work, with no guarantees. If they don’t deliver, they won’t be paid for their time and effort. So its in their best interest to serve the client’s interests as well as possible, and do it with a sense of urgency.

What this means for buyers is that a good agent will do the all the upfront work necessary: to understand your needs, and dig deep to find the properties that fit them. An experienced agent understands that the best investment of everybody’s time (including their own) is to only look at properties that truly match.

What this means for the seller of a home is that your agent has a strong incentive to screen a lot of potential buyers and find the best match for your home --- somebody that is truly motivated to buy it, and understands the value of it the same way that you do. They can counsel you when your idea of the value of a property is unrealistic. They’ve seen what buyers look for, having worked with many buyers. They know what your home has to offer. An agent can counsel you on the merits of an extra $10,000 vs an extra 6 months on the market. Time is money.

Finally, we’d like to note that trust is vital to an agent’s effectiveness. We don’t mean to imply that you should blindly trust your agent; we share this to further illustrate that our interests are best served by serving yours. An effective agent will work hard to earn your trust, because they have to. Credibility is everything. When the client trusts their agent, the agent can counsel them in regards to their best interests.

Trust comes from transparency and communication. We want our clients to know what we’re doing for them, and we them to be comfortable. That way, when we have to tell a client something they need to hear, they’ll listen. So find an agent who is invested in communication. Find one that encourages you to ask questions, including the ones you worry might sound dumb. Find one that thoroughly investigates your needs, and pushes you to consider things you might not have considered. Finally, find one that is available and easy to contact whenever the need arises.