You know that you need an agent to sell your home for top dollar. You don’t want to go the “For Sale By Owner (FSBO)” route because you’ve heard horror stories of homes that sit on the market for months (or longer) and you don’t want that that to be your story. You want a qualified real estate professional to sell your home quickly and for as much money as possible.
But the only problem is that you’re not sure what to look for. What are the most important things to consider when hiring a listing agent to sell your home?
Sometimes, it’s easier to know what to avoid. In this post, we’ll discuss the most common mistakes many home sellers make when choosing a listing agent. Let’s get started.
Mistake #1: Not Choosing Your Broker Wisely
Let’s quickly define the terms of broker and agent. You often hear these terms used interchangeably, but brokers and agents are different.
Here are the similarities: Both brokers and agents are real estate professionals and both can sell homes. The difference is that a real estate broker is required to continue their education and pass an additional exam for a real estate broker’s license. This state-issued exam is more rigorous than the exam given to real estate agents.
A real estate broker can work as an agent, but not the other way around. Real estate brokers can also work for themselves, or hire real estate agents to work for them. However, real estate agents cannot work for themselves.
Think of an agent as a salesperson for a broker. The broker is responsible for the agent. This responsibility also extends to training the agent. So, when you’re hiring an agent, you’re also hiring the broker. Some brokers are more hands-off but, at BOND, we have an intensive training and certification program for all of our agents—it’s the most comprehensive in the industry. We ensure that all of our agents are well-prepared for selling your home.
Mistake #2: Going for the Big Sell
Some agents will say whatever it takes to sign you on as a client. One of the most common mistakes to avoid? Choosing an agent because he or she promises to sell your home for more than the other agent(s) quoted.
Sure, it’s an ego boost to hear that your home can sell for tens of thousands more than you were quoted previously. But, don’t fall for it. As a general rule, if you’ve interviewed five agents, and four of them say that your home will sell at $660,000 and one of them says $705,000, throw out the highest bidder. One of these is not like the other. While they’ll get an “A” for optimism, an unreasonably high listing price isn’t going to sell your home.
Many agents understand that going lower attracts more interest and can even drive up the price of the home. You want to start out with a strong listing price, but not one that’s overly confident. If your listing price is too high, you can repel a lot of buyers. And any buyer’s agent who knows the area won’t, in good faith, show your over-priced home to their buyer.
Plus, banks won’t offer a loan for a home that doesn’t appraise at asking.
A good listing agent will research comparable homes in the area and set your expectations for how much your home can realistically sell for—even if it disappoints you. You need an agent who gives it to you straight, not someone who tells you what you want to hear.
Mistake #3: Going for the Lowest Commission
Speaking of what you want to hear, avoid agents who offer you the lowest commission to sell your home. That’s a bad sign.
Think about it: You want an agent who can negotiate the best price for your home. What does it say when the agent can’t even negotiate the best commission rate for themselves? If they’re undercutting themselves, what will they do when it comes to your home?
As the saying goes, you get what you pay for.
When working with a lower commission, the agent won’t have as much capital to spend on marketing for your home. Your listing will suffer because of it. You need to market to as many eyeballs as possible.
And here’s one more important reason not to go for the lowest commission. The commission you agree to (customarily six percent from the purchase price of your home) is usually split 50/50 between the listing agent and the buyer’s agent, with each agent receiving three percent in most cases. If your listing agent agrees to a lower commission than 6%, the buyer’s agent is then forced to accept a lower commission also.
A lot of buyer’s agents will avoid showing homes with low commissions to their clients.
Mistake #4: Buying the Marketing
Some real estate agents are advertising aggressively for themselves. You can see their smiling face everywhere: on billboards, park benches, and subway signs.
That doesn’t mean that the agent is the right one for you. Just because they’re good at marketing themselves, it doesn’t automatically translate to marketing your home. Research the agent’s track record in actually selling homes. Ask the agent to show you how they market their current client’s homes—and look at the proof.
Also, don’t make the common mistake of choosing an agent that promises non-stop open houses. Open houses can be effective at selling your home, but it’s rare. Only two percent of open houses end up in a sale.
Don’t just buy the promises, look for the results.
Mistake #5: Choosing the Agent Who Aligns With Your Opinion
Do you really want a “yes” man or women selling your home? If you blindly choose an agent that agrees with everything you say, you’ll regret it.
Think about it: The reason you’ve decided to work with an agent to sell your home is because he or she has the experience and the know-how. Don’t reject their professional advice simply because it’s not what you want to hear.
I understand that’s easier said than done. That’s why it’s so important to choose an agent who has a proven track record for selling homes. Then, you can depend on their experience when you’re unsure of their advice.
Mistake #6: Choosing a Part-Time Agent
One of the first questions that you should ask a potential agent before signing with them is: Do you work as a full-time agent or do you sell houses on the side?
If the agent works part-time, skip to the next.
I know that sounds harsh, but you need someone who eats, sleeps, and breathes real estate—not someone who does it on the side.
Selling your home is a full time job, which is one of the reasons why you don’t do it yourself. It takes a lot of time to research comparable homes in the area and market your home accordingly. That’s not to mention fielding calls of interest in your home, scheduling showings, attending showings, and more.
If your agent doesn’t work full-time, you could be missing a lot of opportunities to sell your home—calls that may be answered by other real estate agents.
Mistake #7: Not Asking the Right Questions
When you interview your prospective agent, are you asking the right questions? Here are the top questions you should ask:
- How much can you sell my home for?
- Tell me about your most recent sales. How much did the home sell for?
- What’s your average ratio between listing price and final selling price? (Hint: look for the smallest ratio, it indicates that the seller is good at pricing homes)
- What’s the shortest time in which you’ve sold a home?
- Do you specialize in selling my type of home?
- What will be your marketing strategy for selling my home for the most money in the shortest amount of time?
- Can you give me references for the last three homes you’ve sold?
Avoid these mistakes and you’ll find the perfect agent to list and sell your home. Rest assured, the perfect agent is out there, and you can start your search right here.