Top Myths About Real Estate Agents
The luxurious lifestyles of highly successful realtors around the country have spun a web of aura around the profession of real estate. Ordinary people remain in awe hearing stories about the kind of incomes earned by the top most real estate agents.
It is true that the career of a real estate agent is a highly rewarding one, but it also involves long struggle and constant hard work on the part of agents. There are many other misconceptions about real estate agents that become known to individuals only after taking a plunge in this profession. Here are top myths about real estate agents that keep circulating among aspiring agents.
All agents are the same
This is the biggest myth in the minds of ordinary people when they are about to hire an agent for their real estate transaction. This misconception forces people to make a mistake when choosing a realtor for their transaction. All agents are different in regards to their knowledge, expertise, area of operation, and experience.
You need to find a real estate agent based upon your requirement after going through their portfolio to know if they are fully equipped to do justice to your deal. You need a buyer’s agent to represent you when you are planning to buy a house not a seller’s agent who specializes in selling homes for his clients. Similarly, you need an agent who has the knowledge and experience of selling luxury homes if you are trying to sell your luxury property.
You save money by not hiring an agent
Many buyers believe they can save on the commission of their agent by directly approaching the owner of the property or his agent. You should remember that the commission of your agent is paid out of the proceeds of the sale of the property and it is divided among agents of both sides equally.
If the seller’s agent has been promised a commission of 5%, he is entitled to keep the entire amount if he is asked to represent both the seller as well as the buyer. You cannot hope to save money by not hiring the services of a real estate agent.
You are stuck with the agent you hired
This is a myth that makes many buyers and sellers fearful about their prospects of a real estate transaction. If you have hired the services of a listing agent to sell your property, you sign an agreement with them that mentions the duration of the contract. This contract is usually six months to 1 year long.
This means you are free to switch to another realtor of your choice if your agent is not able to close the deal successfully in the period of the contract. However, you cannot do a thing to get rid of your agent if you do not like his style of working or attitude after signing the contract with him. Therefore, it is so essential to select the right realtor with whom you are comfortable working with.
When you are buying property, on the other hand, you do not have to stick to a realtor as buyer’s agents usually do not sign a contract with their clients. You are free to see properties suggested by another real estate agent.
Agents who are the most busy and popular are the best
This is a myth that works in favor of top real estate agents working in a housing market. They keep getting approached by clients for their transactions even though they already have loads of work on their hands. If the agent is so busy that he hardly has the time to pay attention to your requirements and suggestions, it is not prudent to work with such an agent. He will assign some of his responsibilities to his juniors or staff members to accommodate your case.
On the other hand, someone who is not as busy but has enough experience under his belt will prove to be more helpful and beneficial in your case. It is always a good idea to personally meet and talk to the realtor to know about his availability and flexibility before signing the contract with him.
You get a better deal when you pay less commission
If you force a realtor to accept a low commission, you might think that you are saving money. However, you are jeopardizing your real estate transaction as the agent might provide a lower quality of service because of low pay. This myth creates problems for many individuals.
All real estate agents make a lot of money
This is a myth that attracts many men and women to take up the profession of a realtor as their career. It is true that the top producers in any housing market do earn hundreds of thousands of dollars in the form of commission form their clients. But the numbers of such real estate agents is very small. A vast majority of real estate agents working across the country are earning a median annual income of less than $50,000. In fact, more than 80% of all individuals who join this profession every year fail miserably and leave the industry as they cannot earn enough money to survive.
When people think about the income of real estate agents, they imagine a 6% commission from the sale of a property. If the property is sold for $300,000, they think that their realtor would get $18,000 as commission. First, the commission of a real estate agent is negotiable, and many agents agree to work for a lower commission just to get work. Also, the commission, whether it is 6% or 5% is equally divided between agents of both sides and not taken by one realtor. There are also listing and selling brokers who take their cut from this commission.
Finally, one needs to think about all the expenses incurred by real estate agents before focusing on what they are getting for their hard work after a deal. Agents must spend money on their marketing, transportation, phone, and furniture and office to manage their work. Then there are utility and internet bills that must be paid by these agents.