Selecting the Right Realtor

    One of the largest investments most of us will make during our lifetime is the investment we make in our home. While we typically are very cautious on the selection of other financial professionals we employ, some of us tend to hire our Realtors for the wrong reasons. Most of us would not trust the preparation of our taxes or the management of our investment portfolio to "a friend that just got their license" or a "co-worker that is doing it part time" or "an uncle in the business". We probably would not consider it relevant that our broker sold more XYZ stock that anyone else in the firm or our CPA is the top sales person in the company. What we would consider relevant is their expertise. Real estate investment, your real estate investment, is no different.
Contract Law
    In order to purchase or sell your home you will be required to execute a legally binding contract. A misplaced word or an improperly drafted clause could make the difference between a smooth transaction and a nightmare. The importance of drafting a complete Purchase Agreement cannot be over emphasized. An agent with a thorough understanding of contract law is a must in today's litigious society. For instance, in most Purchase Agreements the closing date is approximate. If, for instance, the other party postpones the closing, you may find that you are obligated to suffer a delay without recourse or reimbursement. If time is of the essence, it should be stated as such in the contract.

The Salesperson vs. the Consultant
    Salesmanship is rarely an asset in real estate transactions. What the parties on both sides of the transaction typically need is a consultant,  someone with experience that can provide the information needed to make an educated decision.
    Houses aren't "sold" but rather "bought". I can't imagine a situation where a buyer would buy a house because the Realtor was a good sales person. People buy houses that meet their needs. The seller's challenge is to make sure the property is easily found by agents and buyers. That is accomplished by creating a quality advertising piece, such as the MLS data sheet, that entices buyers and their agents to tour the property. An agent skilled in visual and written arts can make all the difference in the way your property is viewed by potential buyers. All properties listed by members of the MLS have equal exposure, but not all exposure is equal!

There is no Substitute for Experience
    Much of what we learn, in any profession, is learned through experience. It is easy to get through simple transactions by following the steps learned in school. Difficult or complex transactions are not so easily resolved. These lessons are often learned through experience. After all, who would hire an attorney just out of law school when an experienced, seasoned attorney could be hired for the same cost?

Dealing with Home Inspections.
   The most difficult area of the transaction today, for sellers, is not in finding a buyer, but in dealing with problem home inspections. Finding the buyer is probably the least complex of all the steps in the process. There is little difference between agents in that part of the process, as we all draw from the same pool of buyers. Of course, some agents do a better job than others, which can be seen from their average market times.
   The place where sellers get stung the most is in dealing with inspections. Many inspectors flag problems that don't exist or over exaggerate the ones that do. Buyers often respond to an inspection by asking the seller for as many repairs as possible, some of which are in fact excluded by the language of the contract.
    Sellers that work with an agent that is well versed in contract law and well trained in construction sciences fair much better than those that work with one that isn't. I have heard of countless horror stories where sellers have thrown away hundreds of dollars on unnecessary repairs because of an ineffective agent that either did not know how to respond to an aggressive buyer or was unwilling to take a strong stand.

The Agent or the Company, Which is More Important?
    The vast majority of the interaction between client and agent will be agent specific. The company resources will rarely come into play in most transactions. Of course, a new agent can benefit from the knowledge of more experienced agents in the company.
    The importance of the company is primarily in how it relates to the agent's ability to meet client needs. Companies that endow their agents with flexibility to meet their clients needs are probably going to have a higher level of satisfaction among clients than those that are hard and fast in their policies.
    Higher commission rates don't necessarily equate to higher levels of service. How well the agent is compensated by the company will be the major determinant on the level of service their clients will receive. Agents that receive low pay out ratios will have to do a large volume of business just to meet their living expenses, which means there will be less time available to take care of their clients' individual needs.
     Remember, in the real estate business big is not always better, and paying more does not guarantee higher quality. Invest the time to thoroughly interview prospective agents to make sure you are getting a person qualified to handle one of your top investments.


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