While many first-time homebuyers often think that realtors are overpaid (and as a result go without them), experienced buyers are relying on realtors now that we are entering a seller’s market. With steadily rising real estate prices, the assistance of a real estate agent can help buyers and sellers alike navigate an increasingly competitive and complex world of searching and negotiation. Here we discuss some of the ways that clients and realtors can work together during the housing search.
Let’s take a step back and look at an example of say, a friend of yours, looking to purchase a house without an agent. This friend made offers on five houses and not one of them accepted, despite the fact that he spent many hours researching properties and looking at houses. He did eventually find a house that had no offers on it, but he admitted that he’d lost far more money than he had saved by handling the process himself. All the time he spent searching and negotiating he could have spent earning money at work, it turns out, if he had asked for the help of a realtor.
Among the big challenges he faced was getting to see the houses before other offers were made on them. Not all of the seller’s agents were helpful. Eventually, the friend did find a house, but the one he wound up purchasing was overpriced. Luckily, there were no competing offers, so he was able to get it for a little less than market value. However, he didn’t have many homes to choose from, as competition for the houses with more offers was just too intense. He wasn’t able to compete without professional assistance.
If this friend had only used a realtor, not only would he have been assisted in making a bid for more homes, but he also would have received guidance on contracts, on how to ask for price reductions, and on how to get sellers to cover closing costs. Additionally, a realtor could have helped him find accurate information online, form an appropriate strategy, and learn how to maximize real estate contacts in the area.
It was easier for buyers to represent themselves when we were in a buyer’s market. However, situations with multiple offers are common in today’s seller’s market, and the un-represented client’s offer may not be accepted when competing with other offers presented by realtors.