What’s the biggest mistake I see homebuyers and sellers making today?
Going with the first real estate agent they connect with.
Usually, it’s happenstance. You find a Zillow link you’re interested in and click on a button. Or you try to sell your house online, and you’re automatically connected with a real estate agent.
But the real estate industry has a huge variance in skill and experience levels. Real estate agents impact how much you pay for a home and whether you can secure a home within today’s hot market.
Let’s look at some of the most important questions to ask real estate agent professionals.
General Questions to Ask Real Estate Agents (Buyers and Sellers)
You want a real estate agent who is experienced and informed about the current market. Ask the following questions to gauge how comfortable they would be helping you complete your transaction.
1) How long have you been in the real estate industry?
A good rule of thumb is to look for an agent with at least a few years of experience. This is the sweet spot for agents, where they’ve likely closed many transactions and have the market knowledge to help you succeed.
2) Do you work full-time as a real estate agent?
Some agents only dabble in real estate. They have full-time jobs or businesses, only working as an agent. These agents may not have the time to devote to your needs. If you want a full-time agent who will be accessible when needed, make that decision early.
3) How many deals have you closed in the past year?
This question is a good indicator of experience and market knowledge. You want an agent who has closed at least several deals in the past year, as this shows they’re likely familiar with the ins and outs of the current market. If they aren’t closing deals now, you need to ask why.
4) Do you specialize in any particular type of property?
You want an agent who is comfortable working with your particular needs. Some agents only work with buyers, while others only work with sellers. Because agents are increasingly reaching out to more creative resources to get leads, you may work with an agent that doesn’t specialize in residential real estate.
5) Do you work with a team, or will you be my only agent?
Some agents work as part of a real estate team. This means several people may be working on your transaction, from showing homes to negotiating contracts. Other agents work independently under their brokerage and will be the only point of contact. Both have pros and cons, so you’ll want to decide what’s best for you.
6) What strategies do you have for working in this market?
The real estate market is always changing. You want an adaptable agent who can change their strategies as the market demands. The answer that your agent gives isn’t as important as the thoroughness of their answer. You want a potential real estate agent who is thoughtful and who has considered how the market has changed over time.
Questions to Ask Real Estate Agents for Sellers
Make no mistake. Despite the slowdown, it’s still a seller’s market. You shouldn’t be afraid of your house sitting on the market. But you want to get the most out of your house. And that means you need a real estate agent who can competently and confidently advise you. Ask these questions before you sign a listing agreement.
7) What is your average days-on-market for listings?
This is a good indicator of how quickly an agent can sell a house. The days-on-market will vary by market, but you generally want an agent with relatively low days-on-market. This means they’re doing something right and selling their homes quickly.
8) What’s your strategy for pricing my home?
Price your house too low, and you lose out. Price your house too high, and it may not appraise. You want an agent who can help you find that perfect sweet spot, where you can capture as much value as possible without getting so greedy that it impacts your ability to close.
9) What is the typical commission you charge?
While agent commission is sometimes negotiable, you should choose an agent who is upfront and honest about their fees. You don’t want to be surprised when it comes time to write the contract.
10) Do you provide staging or photography services?
In today’s market, making your house stand out is more important than ever. This means having high-quality photos and, in some cases, even staging your home to appeal to buyers. Some agents will provide these services for free, while others will charge a fee. You’ll need to decide what’s best for you.
11) What’s your marketing plan?
You want an agent with a comprehensive marketing plan to get your house in front of as many buyers as possible. This may include online listings, open houses, and targeted marketing to specific buyer demographics. Today, a lot of agents work online to generate leads. It’s not just about posting a property to the MLS.
Questions to Ask Real Estate Agents for Buyers
As a buyer, you need to be competitive. That means having an experienced real estate agent who can advocate for you and tell you which concessions you need to make and which might be foolish. Ask these questions before you agree that your prospective agent will represent you exclusively.
12) Can you provide a list of lender recommendations?
A good agent will have a list of trusted lenders they can recommend. Working with a local lender will streamline the entire process of purchasing a house and reduce the chances of the deal falling through. Ask your potential agent for a list of a few lenders from which you can get quotes.
13) What is the average interest rate you see on loans?
Interest rates are constantly changing, so you want an agent plugged into the market who can give you up-to-date information. An agent isn’t a lender. They aren’t experts in finances. But their answer greatly indicates how much they’ve been paying attention.
14) Do you have any good title companies you work with regularly?
The title company you see can impact the closing process. You want an agent with a good relationship with a reputable title company. This will help to ensure a smooth closing process… and reassures you that your agent has connections. They should also have good companies for a home inspections.
15) How many offers are your buyers averaging before they buy a house?
In a competitive market, you may have to make multiple offers before you get one accepted. This question tells you more about the market than it tells you about the real estate agent, but it’s an important question to ask to set your expectations.
16) How do you recommend “sweetening” my offer to get a deal?
In a competitive market, you may have to get creative. This could include offering a higher earnest money deposit or waiving certain contingencies. Your agent should be able to advise you on which concessions will be most effective in getting your offer accepted. This will further prepare you for entering the market.
17) What is a realistic time frame for me to find a house?
This question will also help you set your expectations. It may be taking three months for buyers to find a house. It’s likely possible that it’s taking six months or even a year. This answer may be higher or lower than average, depending on what you’re looking for.
18) Is my price point realistic?
You want an honest answer to this question. Tell your agent how much you’re willing to spend and ask them if they think you’ll be able to get what you want. It’s possible that you may need to adjust what you’re looking for. It’s better to have an agent that will be honest.
Red Flags When Interviewing Real Estate Agents
Most people only hire a real estate agent once or twice in their entire lives. So, it can be difficult to identify potential red flags. In general, follow your gut. If you feel nervous about someone, there’s probably a reason.
Here are some of the most obvious red flags.
1. Lack of experience
Now, that’s not to say you can’t find a great agent new to the business. But if an agent is fresh out of real estate school and has only closed a handful of deals, that’s something to be aware of. If they’re working with a team, this could be mitigated. But know that a lot of real estate is about who you know. They won’t be well-connected.
2. Lack of market knowledge
If an agent doesn’t know the ins and outs of your particular market, they won’t be able to help you navigate the process as effectively. An experienced agent will be familiar with recent sales in the area, up-and-coming neighborhoods, and any potential red flags with a particular property. They will also be able to describe how the local market is shifting.
3. Lack of referrals
If an agent has no referrals from past clients, that’s a huge red flag. It means they’re new to the business or haven’t been able to build a strong network of satisfied clients. Either way, you don’t want to work with an agent who doesn’t have anyone vouching for their services.
4. Lack of a solid marketing plan
In today’s digital world, there’s no excuse for an agent not to have a solid marketing plan for your home. They’re not doing their job if they’re not utilizing social media, online listings, and professional photography.
5. Lack of transparency
If an agent is being evasive about their commission or fees, that’s a huge red flag. You should always know what you’re paying an agent before signing any contract. If they’re not upfront about their costs, it’s likely because they’re trying to hide something.
Many new, inexperienced agents are trying to get into real estate because they think it’s easy money. There are also a lot of older, experienced agents who haven’t adjusted to the new market. If your agent can’t articulate their plan for your purchase/sale, you might want to be skeptical.
Conclusion: The Best Questions to Ask Real Estate Agents
The best questions to ask real estate agents are ones that will help you gauge their experience, knowledge, and transparency. If a buyer’s agent or listing agent can’t answer these questions, they may not be the right real estate agent for you.
The biggest mistake you can make is just assuming someone’s an expert because they’re an agent. It’s not easy to become an agent, but people become agents from all walks of life. Some may be experienced, and others may not. A good real estate agent will make the entire home-buying process easier.
Typically, real estate agents earn a commission of 5 to 6% on the sale of a home. This is split between the buyer’s agent and the seller’s agent. So, if you’re working with a buyer’s agent, they typically earn 2.5 to 3% of the sale price. That’s enough of a chunk to be cautious about who you hire.
In some cases, you may be able to negotiate the commission with your agent. But keep in mind that they are providing a service, and they need to make a living. If you try to lowball them, they may not be as motivated to sell your home or help you find the perfect property.
A real estate agent’s job is to help their clients buy or sell properties. They typically work with buyers to find the perfect home and sellers to market their home and negotiate the best possible price. But not all real estate agents specialize in the same things.