When it comes to buying your first home, having a real estate agent who can help you throughout the process is crucial. Considering it’s one of the largest financial transactions you’ll make, you want to ensure you find a real estate agent who is the right fit. Learn how to find a real estate agent and what their job entails.
Do I need a real estate agent?
Real estate agents are professionals who help with selling and buying a home and are useful to have on your side.
These types of professionals serve a number of purposes, including:
- Guiding homebuyers and sellers through the homebuying process
- Helping clients with paperwork that’s necessary to close on a home
- Educating clients about current housing market conditions and trends
- Referring clients to professionals, such as real estate attorneys and home inspectors
All of the above tasks are important, because a real estate agent can help you get the best price for your home and ensure your interests are taken care of. If you’re a new homebuyer, for instance, hiring a real estate agent is helpful, because these professionals can help you with steps you may not even know you need to take.
Is a real estate agent the same thing as a Realtor?
The main difference between a real estate agent and a Realtor is whether or not they’re members of the National Association of Realtors (NAR). Realtors are licensed real estate agents who pay annual membership fees. However, not every agent is a Realtor.
Licensed agents who want to be Realtors need to become members of NAR and abide by their standards and code of ethics. NAR also has other specialty designations for real estate agents who want to demonstrate more expertise in other real estate niches.
What’s the difference between a buyer’s agent and a seller’s agent?
The difference between a buyer’s agent and a seller’s agent is who they represent. A buyer’s agent represents the interests of the homebuyer, whereas the seller’s agent, also called the listing agent, represents the seller.
Here’s a closer look at specific real estate duties:
|Buyer’s agent||Seller’s agent|
|Assists in finding and touring listed homes||Helps sellers pinpoint an asking price for their home|
|Assists in making offers on homes||Guides sellers in listing, marketing, and showing their homes|
|Helps buyers negotiate with sellers||Helps negotiate with buyers|
|Acts as point of contact between homebuyer and seller’s agent||Acts as point of contact between home seller and buyer’s agent|
Depending on your state and the type of agent, some real estate professionals can represent both sides in a single transaction, which is called dual agency. However, this arrangement may not be in your best interest, as you’ll generally want to have someone who is looking out solely for you.
7 tips on how to find a real estate agent
When it comes to looking for a Realtor or real estate agent who is a good fit, you’ll want to ensure they’ll represent your interests and that you feel comfortable with their approach. Look for someone who is competent, communicates well, and is responsive.
To help you in your search, here are a few tips to finding a good real estate agent who suits your needs.
1. Ask for referrals
Reading reviews of real estate agents is helpful, but getting recommendations from someone you trust is even more so. Start by reaching out to your personal network, including friends, family, and colleagues, for referrals. You can also talk to other trusted professionals, such as your mortgage lender or home contractors, to find a good fit.
When asking for referrals, make sure the people you know have worked directly with the real estate agents they’re recommending.
2. Interview multiple real estate agents
Don’t be afraid to talk to a few real estate agents before settling on the right one for you. Homebuying can be stressful, so it’s helpful to have a good rapport with your real estate agent and trust them to work on your behalf.
To start, check to see whether the agent has a current real estate license, which you can do through your state’s real estate commission website. Check references from past clients and read online reviews from several sources to ensure you’re not hiring someone who has received serious complaints.
3. Do your research
Speak with each real estate agent to determine their qualifications and years of experience. If it’s important to you, check to see whether they’re a member of NAR and whether they have additional real estate certifications (if you want someone with particular experience). Other questions to ask include whether they primarily work with buyers or sellers and whether you’ll work directly with them or others on their team.
4. Ask for a menu of services
If you are selling your home, ask how the real estate agent will list and market your property. Will they help you with a listing price based on local market trends? Will they help you with staging or hosting an open house?
If you’re a homebuyer, find out how they will support you as you start your search for homes. For instance, will your real estate agent send you potential listings? How will you schedule property viewings, and will they help you negotiate a purchase contract?
5. Negotiate the commission
Nail down the exact commission with your agent before signing a contract so that you know what you’ll need to pay and how much the other party may contribute. You have the right to ask the real estate agent to lower their commission if you feel it’s too high.
6. Establish a clear communications plan
Establishing a clear plan on how the agent will get in touch with you will prevent miscommunication. Ask how often the agent will contact you and whether there’s anyone else from their team who will be involved in the transaction.
7. Review the contract closely
There are several types of real estate contracts, so it’s important to understand what your rights are. The different types of contracts or listing agreements include:
- Exclusive right to sell your property: You pay the real estate agent no matter how the home is sold.
- Open listing: You pay the real estate agent only if the home is sold through their efforts. If you or another real estate agent make the sale, you are not obligated to pay commission.
- Exclusive agency: You pay the real estate agent if the home is sold through the efforts of any real estate agent. If you make the sale, you are not obligated to pay.
It’s also helpful to understand the timeline for your contract and what fees may be charged if you want to be released early from it. Because real estate contracts can have a lot of confusing verbiage, you may want to have a real estate attorney review the contract. In some states, an attorney is required to oversee the real estate closing.
How much does hiring a real estate agent cost?
On average, real estate agents charge anywhere from 5% to 6% of the sales price. Typically, the seller will pay the commission fee as part of their closing costs. The seller’s agent then splits the commission with the buyer’s agent. In addition to being compensated for their time and service, real estate agents use their commission to pay brokerage fees and marketing expenses to promote listings.
FAQs about hiring a real estate agent
What are the main real estate license requirements?
Real estate agents need to be licensed in the state where a seller or buyer wants to conduct their transaction. To receive a license, agents will need to complete a certain amount of education hours, pass an exam, and remain current on their license through their state government.
Is working with a real estate agent required?
No, you don’t need to work with a real estate agent. You can list your home and negotiate a purchase contract by yourself. However, since there are many legalities involved with such a large transaction, you may want to consider hiring a real estate attorney or agent to ensure you’re following the right procedures.
If I’m working with a real estate agent, do I have to hire a real estate attorney?
Some states require that you hire a real estate attorney to oversee the closing process. Check with your real estate agent or state’s real estate commission.
How are real estate agents paid?
Real estate agents are paid a commission once they successfully sell a home. The seller typically pays the commission as part of their closing costs, and the buyer and seller’s agent will split this commission.