I was discussing the marketing of real estate with a client that feels he is on top of his game when it comes to real estate. He is purchasing a home from one of my agents. I filled in for the agent while he was on vacation out of state.
This buyer had limited knowledge of customary issues and real estate is definitely not his game. He is about as savvy as a stump when it comes to real estate. That was evident in the first few minutes of our conversation. This buyer was more interested in impressing me with his knowledge than finding out what he really needed to know.
On the other hand I have met some very well versed buyers and sellers. They have had real experience in real estate transactions flipping homes, building homes, buying investment properties and they use Realtors for their selling and purchases.
What reasons do you think most people use a real estate agent?
Here is a short list.
- To make sure all the legal aspects of the transaction are covered properly.
- To market to other Realtors on the MLS.
- To take advantage of a Realtors experience and negotiating skills
- To make sure the property is priced correctly for the market.
- To maximize selling exposure with an effective proven marketing plan.
- To Help buyers obtain financing and insure their best interests are maintained.
- To review and control the transaction process for either the buyer or seller depending on whom being represented.
- To maintain communication throughout the selling or buying process with the client.
- Coordinate appointments and showings for buyers and sellers
The list can go on and on...but the reasons are personal to each buyer and seller yet they have a common goal. They want to sell or buy real estate and need expert help in achieving their goal.
Having a agent do the work for you may seem costly when it comes time to pay them.
BUT when there is a mistake in your sale or purchase....having a Realtor can save you thousands of dollars.
- Or when you buy the wrong property
- Selling for lower than market is willing to pay
- Paying more than you should in fees
- Not having the paperwork completed properly
- Being involved in a law-suit could prove to be much more costly than any fee an agent will charge
So don't throw your money away just because you thought you would save a few bucks!
Other interesting facts about agent fees you may not know.
- The typical transaction...the agent splits the fee 50/50 with the buying or selling broker...depending on which side of the transaction the agent represents.
- The agent has marketing expenses, printing costs, newspaper, magazine ads, cable advertising costs, monthly Internet fees, monthly MLS fees, National dues, continuing education fees
- Transportation costs, just like you going to work, insurance only usually for a higher limit because the agent has to insure for passengers.
- Monthly brokerage fees
So the big number you see is not the agents to keep. The agents keep a percentage after splitting off chunks of the fee to others just for the luxury of being in real estate.
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