It’s time for some real talk. A good friend shared this story and explanation that I needed to pass along to you.
Last weekend over tea at an outdoor cafe, my friend Christine dropped the news.
“John, I told you that I have been studying for the California real estate exam,” she said. “Well, I just got my test date, October 18th!”
“That’s cool. What are you going to do with it?”
“I’m thinking about becoming a real estate agent,” she said. “But maybe not right away. I’m thinking that I can buy and sell properties for myself to get some experience in the business and to save money. What do you think?”
I told her it’s a bad idea.
“I’ve watched the way you get to know everyone at a party and I know you’re smart. You would be great in real estate, but passing the exam does not prepare you for the real world. You can’t afford to use yourself as a test case.”
Here are just a few facts:
-Buying or selling a home is a business transaction involving hundreds of thousands, if not millions, of dollars. There’s too much money at stake to leave the job to a newbie.
-Buying and selling is an emotion-charged experience. It’s hard to be objective when it is your own home. You need a professional advisor to approach the transaction rationally.
-If saving money is your goal, you could hire an attorney to draw up the contract. But buying a home involves so much more than paperwork!
A good agent will provide far more value than the cost of their fee. A good agent knows:
Prices and Values
–Zillow’s value “Zestimate” has made a lot of people believe that they know the value of any property. It’s not so simple. These estimates are fun to track but famously inaccurate. If you follow the Zestimate in pricing your home, you could be leaving money on the table, or grossly overpaying for your next home. A good agent studies the market every day and stays current on what else is and is not selling in the area.
Neighborhoods
–The character of a neighborhood and the values of homes can change subtly or dramatically from block to block. It’s the subtleties that are hard to notice.
Due Diligence
–A good agent can advise you on the full complement of right inspections and investigations that are available to you, so that you have better knowledge about what you are buying.
Players In The World of Real Estate
–A good agent knows the competitive landscape, including the other agents and their clients. An agent can also introduce you to a wide range of professionals such as mortgage brokers, inspectors, escrow officers, architects, general contractors, structural engineers, etc., who can help you in buying and selling.
Negotiation
–An experienced agent negotiates every day. Their expertise can save you much more than their fee. And an agent, as a third party, can remain cool through heated negotiations.
Counsel and Advice
–A good agent can help you explore and evaluate various real estate opportunities that you may not have known about, including off-market properties. The decision ultimately is yours, but an agent should complement your own knowledge and insight, and be a true partner and sounding board in your analysis of buy and sell decisions.
Navigating the escrow process
–A good agent knows the various ways that a deal can break apart after the contract is signed.
We hire professionals for all kinds of much less expensive matters, everything from cutting our hair to servicing our cars. Why would one NOT use an agent for a home transaction?
