Reasons to work with a real estate agent

When selling

(1) Usually, if a seller does NOT want to work with a real estate agent, the reason is to save commission.  There is nothing wrong with that.
However, why would a Buyer want to purchase a property from a private seller, and ignore most of those that are listed with real estate agents ?
The only reason is that the Buyer can buy the property for a better price ---- and that usually means, the market value of that property less the 6% commission.
So, the Buyer is the one trying to keep the money for himself/herself, and NOT the Vendor.
If that is the case, the Vendor might as well use the professional services of the real estate agent.

(2) Selling or buying real estate is one of the very few transactions involving hundreds of thousands of dollars and is one of the largest transactions in the lifetime of a consumer.   The process involves many legal matters and documents.  A mistake could cost the consumer money or lawsuits.

(3) One might be surprised to know that, if a house is for sale, a realtor likely will sell it for more money than the same owner of the same house selling private.  The reasons are:

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  1. usually, all realtors working in the neighborhood represent 99% of the buyers.  More buyers mean higher demand, which in turn means higher price.  The other side is also true: 1% of buyers means less demand, equals lower price.
  2. See (1).  The Buyer wants to save his/her commission, not the Seller.

(4) Most of the time, Vendors need to work during the day.  While buyers are looking for houses during that time, the vendors selling privately are simply not available for showings.  Opportunities are lost and prospective purchasors go elsewhere.

(5) Selling a house is more than just to puting it on the market.  It has to be “dressed-up” for sale.  This is why “Staging” services have become so popular in order to make the house most appealing and presentable.  An agent knows what to recommend, what things need to be done from a simple de-cluttering of the house to a freshening of paint, prior to the first potential purchasor sees the home.

(6) Since the cost of hoem ownership can be high, Buyers always try to buy at the lowest possible prices.  The Selling Agent is there using his/her skills and experiences to negotiate the best possible price for his/her client.

(7) If a buyer is interested in a house, many times, he/she still needs someone to give him/her advice priot to making an offer.  They know it's a big decision, that's why they may still be hesitant whether to make a move or not, even though  the most important features are already there.  A good real estate agent would provide the need information and advice to make an offer without pressuring their client.

(8) When negotiating an offer, it is more than the price that has to be accepted by both parties.  Too often, an offer is dead because of the closing date (completion day, the day the buyer becomes the owner of the house) or other condition in the offer.

A real estate agent has the expertise and knowledge to put together an offer with the various compponents and conitions in an acceptable manner.

(9) Real estate agents have the means and tools to keep the Seller most up-to-date in their local market place.

When Buying

(1) Usually, it costs the Buyer nothing to work with a real estate agent when looking for a house.  All professional help and tools are at the buyer’s disposal.  The seller is the one paying the commission to the selling/buyer agent. 

However, some buyers might be willing to pay his/her agent commission, in particular in commercial real estate transactions.

(2) Real estate agents have access to the MLS (Multiple Listing Service) information for most of the properties that are available for sale.  This is even more true for residential real estate.  In many North American cities, commercial real estate information is under a different system.

(3) Again, buying real estate is a major decision.  It involves ten’s or even hundreds of thousands of dollars.  The free professional assistance is there to help.  Why not use it ?

(4) For most buyers, in particular the first time home buyer, there are many legal complications, especially on an Offer,  an agent can provide expertise and first hand knowledge.  Consulting a lawyer would cost money.

(5) Many local, state, provincial, or federal governments actually have financial incentives for consumers to purchase a home to live in, especially for the first time home buyer.  They could be in the form of sales tax rebate, retirement savings funds to be used as part of the down payment, or an energy saving plan, etc.  The agent can advise the buyer what incentives are available and which one of those he/she is entitled to take advantage of.

(6) During the process of purchasing a home, real estate agents usually also need to assist the buyer with their financing needs.  Preliminary calculations as to what amount of the borrowed principal the buyer is qualified for can be done by the agent.  All details can be worked out by the financial institute later on.

(7) During the purchase of a home, other professionals are needed.  They include a home inspector to determine the condition of the structure and roof of the house, if there are any, major/minor deficiencies on the house.  An Attorney to act on behalf of the client and to preapre all legal documents and coomplete the transaction.  A Moving company to work on the closing day.  The agent is likely to recommend some of them, and guide the buyer along the way.