Don’t Make Mistakes When Choosing a Toronto Real Estate Agent
Selling a home should be like any other business transaction, but all too often sellers make emotional or impulsive decisions that can end up costing them both time and money. Choosing the right real estate agent to market your condo or house and negotiate the sale is the most important step in the entire process.
Mistake #1 – My friend/family member sells real estate
Friendship alone does nothing to establish a professional’s credentials. Use strict measures when you selecting your real estate agent, just as you would when choosing a lawyer, doctor, or accountant. Most true friends should realize and understand that this is strictly a business decision and will hopefully offer their credentials and experience to compete for your listing. Just think, if a problem or challenge develops while selling your home or condo, do you really want to risk the damage to a friendship or family relationship?
Mistake #2 – Your presentation sounds good, I’ll list right now
Interview more than one real estate agent and listen to more than just one listing presentation, giving serious consideration to the pros and cons of each. Making an emotional decision because you get caught up in the moment might be difficult to remedy later. Since you generally contract to list your house with the real estate agent for a specified period of time, you may find yourself unable to change realtors if you find yourself unhappy with the services you receive.
Mistake #3 – You’re the only agent who agrees with my (high) selling price
Some real estate agents will tell you exactly what you want to hear in order to get your listing. In the real estate profession, this tactic is called buying a listing and is employed by greedy agents who think more of themselves than they do of you. It can work well as a short-term sales tactic, getting them your listing, but it is a very weak strategy in selling your home for the highest price.
The thing is, your property will get the most action from other real estate agents when it is a new listing. When it is priced properly, many agents will show it to their prospective buyers, likely resulting in a sale. If your house or condo is priced too high, very few real estate agents will show your property and it will sit on the market, getting stale. When you finally reduce your price closer to market value, your place has become old news and buyers may think that you are desperate, or that something is wrong. If any offers come, the prices will likely start low and go even lower – with you finding yourself accepting a price that is below what you could have received had the house been priced properly to begin with.
Finally, overpricing your house or condo will only make similar properties look that much better – helping to sell them, not yours.
Mistake #4 – I don’t need references, I’m a good judge of character
Snap judgements simply aren’t good enough. You will want to determine if the real estate agents are competent – and a good way to do that is to check with their past clients. Ask for references on recent sales, contact their recent customers and ask how they felt about their selling experience. How many years someone has been in real estate isn’t all you think about. There are experienced realtors out there who have grown jaded and may not work as hard, while newer agents can make up for experience with enthusiasm and effort.
Mistake #5 – I’m going to list with the real estate agent who has the lowest commission
Everyone has heard the line “you get what you pay for” and in real estate it is no different. Paying the lowest commission possible will often get a sign in front of your property and placement in the Multiple Listing Service, but little else.
You must realize that real estate agents and brokers use their own funds to market and advertise your home – and that costs money! The lower the commission, the less incentive there is for your realtor to invest a lot of their own money to market your home or condo.
Incentive plays a major role in sales. A real estate agent earning a full commission will often drop everything to handle any challenges that come along, while the agent earning the smaller commission has less motivation to do so. This is also important to the buyer’s agent. Since there are usually two realtors involved in every sale, they split the commission according to the seller’s instructions. One real estate agent is your listing agent, the other is the buyer’s agent. When you forced your listing agent to lower the commission, did that also reduce the commission payable to the buyer’s agent? If so, you will find that fewer realtors are willing to show your property, as they’d rather be showing places that offer a more standard (higher) commission.
Finally, negotiating ability is one of the most important skills for a listing agent to have. Are you willing to put your faith in an realtor who can’t negotiate a higher price for themself?
Mistake #6 – All real estate agents passed the same test so they must know the same things
The real estate profession is always changing and evolving, with the best real estate professionals keeping themselves abreast of those changes by continuing to upgrade their education. Some even go beyond the required minimums, acquiring professional designations by taking additional specialized courses.
Mistake #7 – This real estate agent will sell my house or condo by holding open houses every week
Open houses can and do sell homes, but usually not your home. Only a small fraction of properties are sold as a direct result of open houses. Usually, open houses are a way for real estate agents to prospect for potential new clients. They will try to develop a rapport with the visitors to your open house so they learn about their specific housing needs and try to find them the home that best matches those needs. On the other hand, the person who ends up buys your house or condo may have visited someone else’s open house.
A good realtor knows better than to put all of their selling efforts into an open house. They know that the most effective marketing is not directly to the public, but to other agents. By getting other agents interested in your property, your listing agent effectively multiplies their sales force beyond only themselves.
Mistake #8 – I want a real estate agent who lives in my neighborhood
Knowledge of your local market isn’t acquired only by actually living in the neighborhood. Yes, you will want your your real estate agent to have a good working knowledge of recent sales, available models and so on – but that is easily achieved through extensive research. Remember, convenience is not the primary reason for choosing your real estate agent.
Mistake #9 – Agent X sold more homes last year than anyone else
Sales volume is one thing, but it should only be one point to consider. Think about who is doing a better job, the realtor who listed 35 homes and sold 24, or the one who listed 12 and sold them all? Sure, the first agent sold 25 homes, but they didn’t sell over 30% of their listings while the second agent only sold half the volume, but 100% of their listings.
This raises some serious questions. Ask your prospective real estate agent how many listings they didn’t sell. How many had to be reduced time and again before they sold? How long were the properties on the market? Quantity is important, but only once of the quality questions have been answered to your satisfaction.
The best real estate agent for you is the one who will do the most effective job of marketing your house or condo; the one who negotiates the best price, terms and conditions; and the one who communicates with you, the seller, to make the process as smooth as possible.