Real Estate Agents and Professionals (Perhaps the Most Important Article)
Probably the single best thing you, as a buyer, can do is work with an honest, top-notch real estate agent who cares more about your six-figure investment and financial well-being than their commission check. Sounds easy? Think again.
I want to show a little restraint here and not cast aspersions across an entire industry. But in good faith and conscience, I’m also going to tell you the unvarnished truth as to what I’ve seen over the last thirty years. Those honest, top-notch real estate agents are extremely hard to find. Don’t get me wrong: The overwhelming majority of them are extremely nice and friendly, but that doesn’t make them good real estate agents.
A good agent is going to go over and above the minimum required of an agent and do the extra work to ensure that you do not overpay for a property, even at the expense of their own commissions. Considering that the real estate world is extremely competitive – and for many, commissions are few and far between – the desire to make that next check at any expense can be very strong.
My heart goes out to all of the agents struggling to make a living, and I wish them all the best. But I absolutely cannot recommend any of them to our military clients because buying a home properly, at or below market value, is absolutely critical to a member of the military! Like it or not, you will be moving in three to four years, and you cannot afford to overpay for a home.
A real-life example
Let’s look at how this normally plays out; I witness this happening at least a half dozen times a year. Buyer Bill wants to buy a home and asks real estate agent Sue to help him. After spending several days looking at properties, the buyer falls in love with a home that has an asking price of $220,000.
He tells his agent that he would like to offer $210,000. However, the house has a fair market value of $200,000. But the buyer is not aware of that yet. The real estate agent would have to run the “comps”: the comparable properties similar to the house the buyer is interested in that have sold in that neighborhood in the past six months. Here is where many agents go astray.
Unfortunately, the answer many of them give the buyer is, “Great! Let me write that up for you and submit the offer to the seller.” They know full well that the home isn’t worth that and that the seller will likely jump on the offer or make a counteroffer very close to it. Either way, they’re looking at an hour or two of paperwork, and a few phone calls to coordinate inspections. Then, thirty days later, the property closes and they get their commission check and they’re off, never to be seen or heard from again.
Now, what should have happened? A good, honest, reputable agent would have told the buyer, “First, before we make an offer, let me run the comps on the home to see how fairly or accurately it’s priced … Now based on the comps and the amenities the home has, I don’t see that property being worth more than $200,000. If you want to try and get it at the fair market value, you need to offer $180,000 or $185,000 and see if they’re willing to come down in price.” The agent knows that an offer 20 percent below asking price rarely results in a sale, and that this offer-counteroffer-counter-counteroffer process will likely take several days, and in the end, the deal probably won’t happen. They’ll likely have to start all over again, spending even more days driving the buyer around town looking at another twenty or thirty houses. Whew! That is a lot of time and effort. If the agent had just kept his or her mouth shut, the $210,000 offer could have been submitted, the deal would have happened, and they would be done.
How do you find an agent?
So how do you find one of these agents? Realtor.com, Zillow, or any number of other real estate services and websites? Friends and family? When asked this question, many of our clients tell us they go to these sites and read the reviews of many of these agents. First of all, who is writing these reviews? That’s right, clients just like you who know very little about real estate. Most of these reviews read the same: “Our agent was wonderful. She was very prompt in returning our calls and e-mails!”
Okay, the agent was nice and friendly and courteous, but that doesn’t mean they’re a good real estate agent! Guess what? Most real estate agents are nice and friendly and courteous. That’s part of their job; it’s a service industry.
What is most important is that agent’s real estate acumen, how good the agent is at finding properties at or under market value. How accurate are his or her comparable figures and valuation computations? How deep is the agent’s understanding of market trends, especially concerning growing/expanding parts of towns, neighborhoods, and so on? How expansive is the agent’s understanding of the rental market and rental areas? These are the real estate traits you should be looking for. So how do you find these rare agents?
We work with the best
Fortunately for you, you don’t need to because you now know me. I do know how to find these rare agents because I’ve been in the real estate industry for almost thirty years, and we’ve been helping our clients relocate around the country for over a decade.
As a licensed broker, I know the intricacies of the real estate world, and I know the motivational forces that guide associates, brokers, and agency owners. Over the years, we’ve refined a process of finding these agents, performing background checks and personal interviews with each and every one of them. At the end of this process, there is absolutely no misunderstanding between any of the parties. All actions taken will be for the sole purpose of meeting the clients’ needs and financial best interests. If at any point I begin to question an agent’s motivations, due diligence, and performance with respect to one of our clients, no client will ever be referred to that agent again.
There were a couple of agents last year who received twelve clients from our referrals, with an average commission check of approximately $6,000. That’s roughly $72,000 that we’ve handed those agents on a silver platter. Moreover, they didn’t spend one penny on advertising or lead generation to get that business. It’s business they got from doing their real estate profession extremely well with the highest of integrity and taking great care of our clients. Do you think either of those agents is going to risk losing our referrals just to make a quick buck on a deal? As far as they’re concerned, we’re the golden goose that keeps on giving. They’re going to do everything in their power to ensure our clients get the best deals possible.
Additionally, in contrast to every other agent-finder service out there, absolutely no agents can buy (pay a fee) their way into our network. Nor can they even solicit us to include them in our network. The only way for an agent to be included in our network across the country is for me to find them. We don’t care who they work for—we’ve got Re/Max agents, Coldwell agents, Century 21 agents, local independent agents. It doesn’t matter to us. We simply care that they are great real estate professionals, and that they take great care of our clients.