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The Role of a Real Estate Agent

Selling your home? Here’s what a real estate agent provides.

What is the costliest decision you’ll ever make? 

For most, it’s buying a home. You see a doctor for your health, you consult an attorney if you’re in trouble. If you don’t, you could wind up with a shortened life or behind bars. If you go into the purchasing or selling of a home without a professional, you’re bound to make costly mistakes that could impact you financially for the rest of your life.

What is a real estate agent? What is a REALTOR®?

A real estate agent, working on behalf of a licensed real estate broker, is a licensed professional who works on behalf of the buyer and seller of real estate during a sales transaction.

In other words, a real estate agent is a middleman; an intermediary in a transaction or process chain. A middleman will facilitate interaction between parties, typically for a commission or fee. 

A real estate agent becomes a REALTOR® when and only when he becomes a member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics.

What’s the average real estate agent’s service (when selling your home)?

  • Enter the listing on MLS.
  • Take professional photos of the property.
  • Conduct open houses on the weekends.
  • Include the listing in the local newspaper.
  • Feature the listing on their website.
  • Receive and present offers from interested buyers.
  • Schedule inspections during escrow.

What’s the average real estate agent’s commission? 

When listing the home, it’s between 5-6% of the final selling price. That is, if a buyer brings an offer unrepresented. If the buyer is working with another agent, the commission splits 50/50 amongst the two agents.

What should an agent provide in addition to the basic services above, to earn a fair commission?

  • Devise and fund a moving marketing plan that generates the highest exposure possible in targeted markets. 
  • Provide pricing strategy options based on in-depth analysis of comparable homes in the area and economic market forecasts.
  • Provide consultation on home improvements and effectively stage the home to maximize home’s salability.
  • Negotiate all parts of the deal on your behalf.
  • Leverage relationships with lenders, escrow officers, title and home warranty reps to ensure great service and competitive pricing during the Escrow period.

What’s a good agent worth to you?

If you put a dollar amount on each service item, what would it amount to? Now consider what it would cost you if you were to try to do everything yourself. Add it up to determine what you’re willing to pay an agent for their services.

Don’t be misled. Sure, there are bad agents out there. But there are great ones too. 1) Make sure your agent is a licensed REALTOR®. 2) Be smart and do your homework. Interview several agents and get them to itemize on paper what they provide. 3) Don’t be afraid to tell the agent what you’re looking to spend and negotiate more or less based on your needs.

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For more information on the process, contact me at amanda.youngblood@pacificsir.com.

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What to Know Before You Shop for Homes

A quick guide to shopping for homes in Southern California.

For many, a home purchase is the biggest decision one makes. In today’s market, it’s critical you do your homework so you don’t make unnecessary and costly mistakes. Your home buying journey begins up to 1 year, for some even more, in advance of purchasing. Here’s what we recommend:

6 months – 1 year in advance: get your affairs in order. 1) Know your credit and 2) come up with a plan for your down payment. If you have a neighborhood in mind, find out the average prices. To be competitive, it’s recommended you put 10% or more towards a down payment.

1-3 months in advance: decide on what’s important and select an agent. It’s important to write down 5 things that are most important to you, i.e. good schools, nice view, short commute, large square footage, investment potential, etc. Your new home should meet at least 3 of the criteria. As for an agent, he/she will become your most trusted advisor throughout the process. Select carefully and start working with him/her now.

2-3 weeks in advance: obtain a loan pre qualification letter from a lender. The most popular options are to either choose a private local lender or to choose a large bank, i.e. Bank of America/Merrill Lynch or Wells Fargo. A private lender may be able to close much quicker and will likely require less documentation up front; however, their rates are often on the higher side. Large banks typically take longer to approve and close because they require a large amount of verification paperwork. One advantage to using a large bank however, is their rates are usually more competitive.

IMPORTANT: You do NOT want to look at any homes without obtaining a pre qualification letter first!

Sellers, especially in Southern California, will only entertain offers that come from pre qualified buyers.

Now it’s time to shop!