That’s a solid maybe. If you’ve seen recent Hollywood movies like “The Big Short” where air-headed Realtors converse over cocktails lavishly laughing about how much money they make without a clue how the game is played, you probably have a bad representation of us.
There’s also the real-life version, driving around in a brand new Audi or Mercedes, who don’t seem to know how to tie their own shoes. This exists even in our great state of Alaska!
While these examples of fictitious and real-life personas do exist, do they really get paid too much?
What Is Their Job?
A discussion we should have first is: What is their job? Typically, it is to represent a homebuyer or home-seller in the process of buying and selling homes. This is where the term “Buyer’s Agent” and “Listing Agent” come from.
It is notable to mention that typically, a normal person’s biggest purchase in their lives will be real estate related. It would then only make sense that some of the biggest commissions to be collected in a sales job would come from real estate.
Let’s dissect this a little further though. We know what their job is, but really, what do they do for all that money?
Buyer’s Agent
This is the guy or gal that is helping you buy your first home, or your next investment property. Their sole duty is to represent you as a buyer during the process of closing a prospective home. This can also be more time consuming than representing a seller. Typically, the process goes like this:
· Identifying a property that fits your specific criteria, including:
o Performing CMA’s to make sure the property is priced appropriately
o Performing cost analysis sheets if the property is an investment
o Performing projected gross and net proceeds if the property is a flip
o Finding the best neighborhood based off of your specific needs
· Help identify specific loan programs that are best for your specific needs
· Doing their homework based on market knowledge to form an offer
· Presenting the offer in the most appealing fashion, and negotiating:
o Closing Costs, Terms, Repairs
· Connecting you with Home Inspectors and Contractors who are the best in their field for the prospective property
· Connecting you with legitimate title companies
· Making sure all parties of the transaction abide to strict timelines and deadlines as to not delay closing
Basically, if your buyer’s agent is doing their job, you say, “I want this property, make it happen” while you sit back and they guide you for every step. If your Agent is not doing this, you’ve picked the wrong one.
Seller’s Agent
This is the individual who helps you sell your home. Their sole duty is to price, market, and negotiate the sale of your home. This can be a harder task than being a Buyer’s Agent depending on the market, and it most likely will result in a direct cost to them (through marketing and advertising). How do you know if your Realtor is doing a good job? They should be doing the following:
· Appear professional in your first introduction or interviews and well established in their market knowledge and abilities
· Adequately present you with CMA’s (comps) for your property to indicate they have found the HIGHEST price for your home that will still let it be competitive on the market (overpriced homes don’t sell)
· Market your home, including:
o Professional Photos
o Flyers
o Signage
o Internet Marketing
o Direct Mail Marketing
o Lead Capture of prospective buyers
o Open Houses (though studies show these aren’t that effective)
· Easy accessibility for ALL PARTIES (if your Realtor doesn’t answer their phone for you, will they answer for an eager buyer ready to write an offer?”
· Knowledge and use of technology, including: Microsoft Office, Social Media Platforms, MLS systems, Website monitoring, Client Monitoring and integrated calendar scheduling
· Firmly negotiating incoming offers with your best interest in mind
· Keeping you up to date with the market
· Keeping you up to date and on timelines for the transaction
· Knowing what to watch out for during your transaction (weak offers, weak lenders, weak buyers, potential downsides to offers and contractors or companies to avoid, etc.)
If your Realtor is not doing ALL of the following, you may have chosen the wrong one!
What’s The Verdict?
Poor performing Realtors are definitely overpaid! Whether they have a big name and do volume just because they can, or they are just starting out, you can definitely over pay for a poor service.
If you’re Realtor is on point with their Reaxl Estate game, you’re not over paying at all. I can tell you from personal experience; I have experienced more joy and more stress in Real Estate than anything else I’ve ever done in my life. My phone is almost never off, and I try to be accessible at all times for the convenience of my clients while maintain a family life. 5AM phone calls, and showings at 7PM on a Sunday are the easy busy-work tasks that a solid Realtor has to deal with.
Before you choose to hire a realtor, ask them the tough questions before handing them over their commission. Make them work for it, but be polite. Interview multiple candidates for the job until you’re confident you’ve found the right help!
If you’re looking for a local Realtor to assist you with buying or selling in Anchorage, Eagle River or Wasilla and Palmer, call or text James Cash today at (907)-360-7448 or e-mail at jamesfcash@gmail.com