Home sellers are frequently guilty of making two grave errors when choosing a listing agent:
They focus on the agent who suggests the highest listing price
They prefer to use an agent who takes the lowest commission
The fact is that both of these criteria rarely reflect the competency of the agent. Let’s consider why this is so.
It’s a fallacy to believe that an agent is unable to provide you with a strong indication as to how much you can get for the sale of your home. They can demonstrate active sales, pending sales, and comparable sales. However, it’s you who chooses the sales price and the buyer will inform you if the price is right for them or otherwise.
Some agents distort the sales price to get the listing
An agent never can guarantee the sales price and as such, the agent who proffers the highest listing price is likely being untruthful. In which case, ask for the numbers in support of their suggestion.
Opt for a sales agent who provides a range of prices
The price range may be as much as $10,000 or even more. There are many factors which will determine the range, such as current market temperature, location, and home improvements.
By opting for an agent that possesses a large marketing budget, it’s more likely you’ll see greater buyer exposure which in turn means there’s all the more chance for a good offer.
Agents who work for less than their competitors
A real estate agent or broker who works for less than their competitors (i.e. earns less sales commission) may choose to do so as a way to stand apart. It may be tricky to compete in an overly competitive market since the agent is unable to provide a better service, negotiation skills, or knowledge base.
An agent may offer a cheap fee and in which case you should ask why. Are they unqualified or
desperate for your business?
Nevertheless, there are occasions when a full service agent will opt for a lower sales commission:
You prefer to do the legwork such as the advertising and you also prefer to pay for any salesrelated expenses.
When you are buying and selling simultaneously and giving the business to the same agent.
You’re selling more than a single home.
You intend to offer future business to the agent.
The agent must match a competitor’s fee or lose the business.
The agent is willing to accept you as a pro bono case.
You are currently short of equity and thus unable to pay the commission in full.
The agent prefers to forgo a full commission in favor of signage (more publicity).
If you prefer to interview a variety of agents and find it difficult to choose one, ask to see a record of original listing prices and sales figures. There’s a good chance that the lowcost agent will demonstrate a greater number of price reductions as well as longer DOM (days on the market).
Sales Tip: should your home be located in a neighborhood that is proven to be a hard sell, it’s good policy to hire an agent who is very familiar with the neighborhood. The more firsthand knowledge the agent has with respect to the area, the better.
Here are a few characteristics of a good listing agent:
Honest. You can trust your gut feeling on this – your chosen agent should always tell you the truth.
Experience. If it’s a new agent, it’s wise to let them gain experience on someone else’s dime.
Negotiation skills. The aggressive negotiator is a far better alternative to an agent who seeks to make a quickfire sale at your expense.
Network. Selling homes is a people business. Frequently, homes will sell because one agent has made contact with other agents.
Education. Be sure that your chosen agent has certificates and degrees in the field.
Communication and availability. Good agents come with solid communication skills and round-the-clock availability.
On a final note, ask the agent to provide a personal guarantee. Should the agent be unwilling to release you from a listing if that’s your desire and to guarantee their performance, it’s best to avoid hiring that agent.