By: Karl Trommler
Prudential PenFed Realty
During nearly 30 years of helping people to sell real estate I marveled at the selection process people often used to help them to plan and negotiate the purchase and/or sale of the biggest asset they held, their home. Since buying and selling are distinctly different as are the skill sets required they should be examined separately. While it is very possible and may even be wise to use the same agent for both they you should still consider the uniqueness of these tasks when deciding. In this article I will only be covering selecting an agent when selling a home.
During my many years of active real estate sales assisting with home sales accounted for about 65-70% of my team’s business. Agents refer to homes for sale by clients that they represent as “listings” because they should be and are usually listed in the area multiple listing services database. This is where most real estate agents go to search for candidate homes to present to buyers that they are currently representing. When a seller is preparing to sell their home and invite potential listing agents to submit a proposal it should include an estimate of value called a Comparative or Competitive market analysis (aka CMA). Most really good agents will also present a detailed marketing plan of what they will do to market, and ultimately to sell, your home to buyers. This is generally done in person in your home but can also be done at the agent’s real estate office. Absent prior experience or an existing trust relationship with an agent it is wise to interview at least 3 agents when deciding.
The majority of sellers use one or more of the factors below to make their decision:
- Which agent’s value estimate most nearly approximates what the seller thinks it should be?
- Which agent will do the types of marketing that the seller believes best and most effective?
- Which agent will be most available to them?
- Which company has the best reputation in the area?
- Which agent they like the most (often translated agrees with them the most)?
While this approach seems logical, the strategies listed above resulted in the poor choices and dissatisfaction for many sellers that often led them to contact my team to either fix an existing transaction or handle the next one for a previously dissatisfied seller. I am not saying that this is totally the seller’s fault because it is not. It is a combination of not understanding the process, of what they have read and heard in the media, what others ( both agents and non-agents including friends, neighbors and family) have told them about real estate and advised them to do, their feelings about their home and a lack of knowledge of the current real estate market.
So that being the case how should a seller decide what agent to use? As a buyer and seller of many properties over the years both as residences for my family as well as real estate investments I found that a few key items enabled me, out of dozens of personal transactions, to only have lost money on one property and that was because of the unprecedented economic upheaval of recent years and even that was just a small loss. Before I present my list I would like to give you some key markers that give an indication that an agent may or may not be one to consider more seriously during the process. These are:
- During the first discussions with an agent are they trying to sell you? (i.e. “…this is a great market to buy or sell”, “…interest rates are the lowest ever”, “I have seen the perfect place for you” etc.)
- Does the agent try to find out more about you, your goals, your perceptions about the market and the sales process?
- Do they ask questions to try to discover why you hold the perceptions that you hold? (i.e. What has helped you to decide that this is a seller’s market? Why do you think that you property is worth $XXX,XXX? Etc.)
- Does the agent start off from the beginning trying to change your perceptions and thoughts about things like market activity, and prices without first understanding them?
- Does the agent meet you wherever you are in the process and not try to push you to move faster? (i.e. Do they offer to get you any info that you request and deliver it the way you want to receive it? Do they try to get to know you and allow you to know them?)
- Does the agent talk with you or to you?
- Do they make eye contact and seem relaxed or do they seem rushed and stressed?
While not 100% foolproof and certainly not a reason to eliminate an agent in and of themselves these markers do indicate what level of trust you might place in what they say when they present to you later.
I always preferred to go the prior relationship and existing trust relationship route mentioned above when choosing an agent which meant that I had to plan ahead and start the process several months to as much as a year before I planned to buy. Otherwise I would have had to follow the less desirable path of interviewing several agents and trying to select the best, yet still unproven, option. My agent selection process included the following steps:
- Develop a list of my goals and desired outcomes including the specific property features that I wanted and the budget for my investment. This would enable me to determine market areas where I could find what I wanted for the price I wanted to pay.
- Begin to collect data on the identified areas and the real estate markets there. In short educate myself.
- Find out what agents seemed to be having success in those areas and then start requesting information about the markets and properties of interest. This would help with the following aspects of the decision:
- Would they try to get to know me or try to sell me or push me into a faster decision?
- Would they provide what I wanted in the way I wanted to receive it?
- Were they attentive and timely in responding to my requests?
- Sometimes I would throw in a request that I knew to be unreasonable to see how they would redirect my thinking? This shows negotiation skills as well.
- Did they know the area and their business?
- Ask them for blank copies of all of the forms typically used to see how well they could explain them to me.
- Ask them for a list of what happens when during a transaction and who is responsible for each step.
- Did they spend more time trying to find out about me and my needs or trying to get me to move faster?
- Did they talk more about their company, themselves and their achievements and successes or about me and my needs?
- Are they up on and using the current technologies in their delivery of information?
4.If an agent did not measure up then I would follow the same procedure as is listed above with others until I found one that made me feel comfortable.
This process not only got me a great agent but also made me a more informed and educated seller and greatly reduced the stress of the process. Waiting until right before you are ready to sell a home is like picking a husband or wife the week before you get married. While it sometimes works out fine you do not have the knowledge that you should have for such a decision, it makes the process much more stressful and increases the likelihood that you will regret your decision. Worse, in either case, it is much more likely to result in financial disadvantages later as well. Then again, I did get a lot of sales from sellers unhappy with a previous relationship and because the expectations from their first experience were so low it made us almost legendary in their eyes from the start once they experienced real estate as it should be.