An engineer in her 60s plans to list her redwood contemporary later this year. Given that nearby houses flew off the market at healthy prices in 2022, she assumes any listing agent she picks will perform the same magic for her place.
But Eric Tyson, a personal finance expert and co-author of “Selling Your House for Dummies,” cautions that finding the best available agent can be a tricky proposition, especially in a changing economy.
“Buyers are much more demanding than they were during the pandemic, when many purchasers bid over the asking price and waived their right to a home inspection. Also, in most areas, it’s taking longer than before to sell property,” Tyson says.
Taylor Marr, an economist for Redfin, the national realty brokerage, notes that it now takes a median time of 44 days to sell a home. That’s the longest time period since April 2020.
Also, compared with a year ago, home-sale prices have dropped in 20 of the 50 most populous U.S. metros.
Given the new complexities involved in home selling, Tyson advises owners to use businesslike methods to find the best available listing agent.
“In many cases, people just make a random selection of agents, picking someone a neighbor or co-worker happens to know. But selling success can depend in large measure on the agent’s due diligence,” he says.
Granted, some owners do well on their sale without a highly qualified agent -- particularly if they’re lucky enough to live in a neighborhood where sellers still hold sway and inventories are lean. But real estate specialists caution against overconfidence, especially at a time when there are crosscurrents in the economy, as there are now.
Whether your home sale is voluntary or involuntary, Tyson says it’s critical you make agent selection a priority.
“Treat hiring an agent as seriously as you would any professional -- including a lawyer, accountant or surgeon,” Tyson says.
Ron Phipps, a real estate broker and past president of the National Association of Realtors (nar.realtor), says more sellers are gradually getting the message about the importance of careful agent selection.
“The good news is that sellers are now searching more widely,” he says.
Here are a few pointers for sellers:
-- Make sure you interview at least two to four 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 suggests 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.”
“It’s a shortsighted listing strategy,” says Phipps, who works for his family-owned realty firm in Rhode Island.
-- Zero in on local knowledge.
Should you consider hiring a recommended agent if their office is located a significant distance away from your place?
Absolutely not, says Tyson, 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.
“Anyone who works more than a 15-minute drive from your place is probably a very poor bet. Geography matters a lot,” he says.
It’s especially wise to have an agent close by if you’re trying to sell a property in a city setting, such as a condo in a high-rise building. In such a case, the ideal agent is typically someone with proven experience selling units in your same building.
“Agents with an intimate knowledge of the floor plans and sales history of your complex can hit the pricing target right the first time. That spares you the agony of multiple pricing adjustments later,” Tyson says.
Real estate agents call the area where they most often sell homes their “farm.” As Tyson says, agents who say they farm your area should be able to demonstrate this with a list of transactions they’ve done there recently.
-- Ask for information about each candidate’s awards and honors.
How can you identify agents who have achieved an unusual level of expertise? Phipps says one way 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. That’s important, he says, because real estate is a cooperative profession, and a successful sale typically involves more than one agent.
-- Choose an 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.
But in a transitional period like the current one, many sellers are understandably nervous that complications along the way to closing might jettison their deal. That’s because qualifying for a mortgage is tougher than it was prior to the major housing downturn of 2008. Consequently, more home loan applications are declined than before.
“Selling has become much more complicated. So 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 ellenjamesmartin@gmail.com.)