The True Value of a Realtor

4/6/20079:04:38 AM Link |  | Add comment

Real Estate

TRUE VALUE OF A REALTOR

Ok, I know that much of the world perceives the real estate agent as making all sorts of money and not doing much to earn it except putting a sign in the yard and then collecting a commission check at closing.  I wish it was that easy … I’d buy a bunch more signs. 

Well, for many of you who have tried to FSBO (For Sale by Owner) you know it’s not that easy.  If it was, there wouldn’t be a need for the industry at all now would there?  How many Austin real estate and Williamson county real estate agents are there?  Over 7500!

So where is the value for all that commission?

1)       MARKETING  -  Honestly, marketing is PERCEIVED as all, or most, of what a home seller hires an agent to do.  REALITY … it’s probably about 20% of the value of the commission.  Why 20% ?  Because of the hard dollars involved.  Ever priced out a small 1” x 2” ONE-TIME display ad in the Austin American Statesman?  CHA-CHING!!!  The cost to be a member of the MLS and Board of Realtors?  The cost of fliers?  The cost of Magazine Ads?  The cost of Internet Marketing?  Virtual Tours?  TV ads?   Don’t forget all the time it takes to put these together … taking pictures, writing ads, submitting by deadlines, etc.  And if the agent has an assistant doing this then the assistant needs to be paid also.    “ADS” is the key word because it all ADDS up!

2)      NEGOTIATION  -  Here’s the meat.  This is worth at least 2/3’s of the commission.  This is where you  are paying your agent to guide you, give you advice, forsee pitfalls that can hurt you.  This is where you are paying for their knowledge and expertise.  Have you ever lost a deal just a few days  before the closing because of something that could have been prevented during negotiations?  If you haven’t then hopefully it never happens to you.  If it has, then you well know the value of a GOOD agent who could have forseen the potential problem.  Losing a deal at the end can be devastating and when you lose it, paying the commission if the deal would have closed would have seemed cheap.

3)      PAPERWORK  -  Shuffling the papers may seem like no big deal but you better know what each paragraph in the contracts and addendums mean.  This overlaps with the negotiation process, in my opinion,  and represents the detailed portion of the sales process.  DETAILS … are extremely important.  Missing one detail can cost you thousands of dollars.

So, when it’s all said and done … do you know how you had a GREAT real estate agent?  When your sale went so smooth you think they didn’t earn their commission.  THAT’S THE MARK OF A PROFESSIONAL … It’s like pulling a tooth without hurting and all you got was a placebo!