Top 7 Reasons to Use a Realtor
By Ki Gray
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Some people choose to use a real estate agent and some people choose to go it alone. One thing I have noticed over the years is that a number of seasoned investors looking in a new city will seek out a good agent while novice investors will frequently go it alone. I have even had a number of successful agents seek out my help when they are moving to our city. Why do some of these seasoned investors choose to work with an agent? Below is a list of 7 benefits of using an agent.
- Understanding potential restrictions of the property. I recently heard a story from a friend at the city development office in Austin Texas. A couple had saved up for their retirement. They wanted to retire and live out in the hill country. They went to the foreclosure auctions. At the auction they purchased a lot for 500,000. It had great views and they were going to build their dream house on it. They had researched the lot before the auction and found it was zoned SFR which means a single family residence can be built on it. After purchasing the lot they started plans to build their retirement house. At this time they discovered the lot was in the 25 year floodplain. My friend at the city development office explained that the lot could not be built on and was basically worthless.
- New developments that might affect a properties value. A good realtor will know of proposed new developments that might affect different properties a buyer is interested in. Whether these developments are positive or negative can be valuable information when weighing different housing options.
- Find potential problems with a property. Although its always a good idea to have a home inspector look at a potential house a Realtor is a good first line of defense to see if a house has inherent problems. An experienced Realtor can notice inherent signs of problems with a house. A good Realtor can also help you be on the lookout for common problems in the neighborhood.
- Contracts. Whenever you sell a house you are entering into a large personal transaction. It helps to have someone on your side that deals with these types of transactions on a daily basis. A Realtor can help with contracts and what is typical. The most common pitfall I see unrepresented buyers fall into is enter into atypical contracts that are not to their benefit. For instance a seller will sign an offer that has an option period that is 4 times longer than what is typical. A buyer might put in offers on multiple properties with long option periods. The buyer will wait and see if the market appreciates. If the market has appreciated the buyer buys the house at now and undervalued price. If the market has gone down the buyer walks away.
- Lack of benefit of going it alone. Buyers frequently think that by not using a buyers agent they will get a better deal from the seller. In most situation the listing agent asks for 6 percent from the seller. If a buyer comes with an agent the listing agent splits the 6 percent with the buyers agent. If an unrepresented buyer comes the listing agent keeps the whole 6 percent. On the selling side fsbo often think they are saving alot of money by avoiding a listing agent. Nationally, FSBOs sell for 14 percent less than agent listed homes in the same neighborhoods. In addition alot of FSBO's still ending up having a buyers agents involved. Their is also money spent on advertising. Since an agent has alot of experience marketing homes the agent often can spend money more effectively on advertising knowing which advertising sources produce the most potential buyers.
- Looking for listings without an agent can take up large chunks of time. When looking with an agent you can see several homes in a few hours. When going it alone you have to call the listing agent for each house and wait at the house for the agent to arrive and open up the house.
- Security. When a home is listed with a broker agents coming to the house have to usually log in. This keeps a record of every party coming into the house. Since their business is on the line agents are pretty unlikely to damage a house. Its generally not a good idea to have random people you don't know come into your house for a variety of reasons. Often sellers simply have a phone number. But that phone could be their house, a friends house, a pay phone, or even a stolen phone.
Ki Gray is a realtor with the Austin Texas Real Estate Group in Austin Texas. Their website escapesomewhere has a free Austin home search. They also offer a custom Real Estate Calculator.
Article Submitted On: April 26, 2007