In the Denver, Colorado market, 15 percent of real estate agents do 85 percent of the transactions, so it is important to know that you are working with an agent who considers it their job and not their hobby. If you are considering using a family/friend/neighbor new to the business, ask yourself if supporting them is worth at least $1,000 to you (and that’s probably a conservative number).
The fact is, seasoned agents know their sh*t (what the value of the house is, how to negotiate an inspection, which professionals you may need post-close), and new agents don’t have that confidence or those resources.
To help prevent you from working with the wrong agent (and potentially losing money), we recommend asking an agent these four questions when deciding if you should move forward.
How to Choose a Real Estate Agent: Important Questions to Ask
1) How will you communicate with me?
Prior to being an agent, my experience with buying a home was that it was intimidating. There are a lot of decisions to be made, there is a lot of money on the line, and it’s something I had never done before. Because of that, I think it’s really important that your agent is in communication with you constantly: these are the next steps, this is what that term means, this is what I think the other side is thinking, etc.
If you’re having to hunt down your agent, that’s not a good sign. Remember: you are paying them, and your relationship should reflect that.
2) How many deals have you done in the past year? Where? And what type of property?
Okay, so that’s three questions, but they’re all getting at the same general info we want to know: how experienced your agent is and what that experience looks like. Obviously, more experience rather than less is better, but I feel like someone with 10 or more deals should at least have a good understanding of the process and patterns.
3) How did your last three inspection negotiations go?
This is the most important question you can ask an agent, because it will tell you two really important things:
1) What they consider their job to be.
2) How hard they’ll advocate for you.
Specifically, my job is to help you make a responsible financial decision — and that often comes out in how much we pay for the house and how much we get back in negotiations. Take this with a grain of salt, because I work in Denver and Colorado Springs. Regional prices, of course, differ. But at a bare minimum, you should be getting back $1K during inspection.
4) How long is your contract?
Denver real estate agents and their clients formalize the relationship with an “Exclusive Right to Buy.” This is the contract that states you are working together and that the client is not working for anyone else. Most agents want them signed; in fact, an agent who doesn’t want one signed is probably not very experienced.
It can be difficult to want to commit to someone though when you are just getting acquainted. For that reason, I recommend three month intervals. It’s enough time for both sides to establish if they like working together and if they should continue to work together.
The Bottom Line
Real estate agents (somewhat deservedly) get a bad reputation. It’s a profession with a low barrier to entry and historically terrible customer service.
That said, there are plenty of agents who take working with you very seriously and are very good at what they do. Don’t settle until you find someone like … us, at Advanced Realty Group.
© 2020 BiggerPockets, LLC | All Rights Reserved | January 27, 2020
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