As the housing market rolls into the first quarter of 2020, buyers searching for a brand-new home have cause for celebration. Finally, builders are stepping up production.
After the Great Recession, residential construction -- especially for affordable single-family homes -- took a steep drop. Nervous about whether the economic recovery was sustainable, many builders backed off for years. Until now.
Tom Early, a longtime real estate broker, says an increase in new construction not only helps buyers. It also motivates potential move-up sellers who’ve outgrown their homes. For several years, many would-be sellers have been sitting on the sidelines, waiting for more new construction in their price range to become available.
“Lots of people with growing families are thrilled at the prospect of an exciting new place with the bells and whistles they see on the TV home shows. They crave high ceilings and a big eat-in kitchen that flows into a spacious great room. They also want extra bedrooms for home offices,” says Early, a past president of the National Association of Exclusive Buyers Agents (naeba.org).
Early, who works solely with buyers and takes no listing contracts, says it’s critically important that all sellers find a highly professional agent to represent them.
“Who you pick is hardly a trivial matter. Just as you spend time finding a good lawyer, accountant or doctor, you should do likewise when you’re trying to locate an excellent listing agent for your sale. This is just basic due diligence,” he says.
As Early points out, finding the best available listing agent can be harder than it seems -- despite the fact that more than 1 million Americans are licensed to sell real estate. Here are a few pointers:
-- Search for an agent who knows your locale well.
Your uncle or someone you know from your church or synagogue might be an excellent real estate agent. But should you consider hiring this person if their office is located a significant distance away from where you live?
Absolutely not, says Early, who contends that a faraway agent is likely to be much less effective in marketing your property than one who knows your local turf well.
“No matter how sharp he is, you really don’t want that agent across town who doesn’t have an intimate knowledge of your neighborhood,” Early says.
It’s especially wise to have an agent close by if you’re trying to sell a property in an urban setting -- such as a condo in a high-rise building. In such a case, the ideal agent is often someone with proven experience selling units in your same building.
“For one thing, the pros in your immediate area know the nuances of pricing much better. For another, they’ll know other local agents with clients who are searching for the exact type of property you’re putting up for sale,” Early says.
-- Schedule an in-home visit with at least two to three listing prospects.
Without interviewing other contenders, you may be tempted to simply hire the first agent who comes highly recommended. But Ronald Phipps, the broker-owner of a family-owned real estate brokerage, says it’s wise to interview at least one to two other candidates.
“When you talk to several people, you’ll get different perspectives on your sale,” Phipps says. Several opinions on pricing can be especially helpful.
He says you should be wary of any agent who recommends you list your place for more than 10% above what others say is its fair market value.
“Find out how they arrived at that higher price,” says Phipps, noting that occasionally some agents may suggest an above-market list price as a way to flatter you into hiring them. This practice is known as “buying the listing.”
-- Request information on the candidates’ professional accomplishments.
How can you identify agents who have achieved an unusual level of expertise? Phipps says one way to distinguish among agents is to ask if they’ve been elected to positions of leadership within their professional groups.
“This shows they have a reputation for collaborating with other real estate people,” Phipps says.
-- Select a seasoned listing agent with a proven deal-closing record.
During boom times, most sellers feel home free once they’ve obtained a ratified contract -- meaning their deal has been agreed upon by both sides of the transaction.
The economy is strong now. Still, Phipps says many sellers remain understandably nervous that complications along the way to closing could scotch their deal. That’s because these days, more purchasers have to drop out because their mortgage financing has been turned down.
“Selling has become much more complicated. That’s why it’s smart to find an agent with experience handling many different kinds of transactions. Look for their record of closing deals, not just taking listings,” Phipps says.
(To contact Ellen James Martin, email her at firstname.lastname@example.org.)